It’s Time to Buy the “New” Cisco Systems, Inc. (CSCO)

The issue is still with poor IT spending. And that seems to be the prominent theme regardless of where you look. But waiting on spending to rebound is easier when a company has a plan, which Cisco clearly does. Cisco’s been using this macro headwind to its advantage. As rivals like Juniper Networks, Inc. (NYSE:JNPR) are looking for ways to cut costs, Cisco’s rash of acquisitions, including Intucell and Broadhop, positions Cisco with new addressable markets like software defined networking, or SDN.

Essentially, Cisco is saying it no longer cares to be just a hardware shop, which is why declining router revenue was not that alarming. The company’s been making no investments in that area. What’s more, Cisco recently unveiled its virtual cloud-routing and WAN optimization platform, aimed at taking a bite of out Riverbed’s 52% WAN market share. Plus, given that Cisco still has $45 billion in cash, there’s a good chance that this level of assault has only just begun.

Tremendous buy at this level
All of this makes Cisco Systems, Inc. (NASDAQ:CSCO) one of the best and safest stocks to own. Besides, there’s no way Cisco will accept just the 4% growth that it’s calling for on the low end of its guidance — not with its cash hoard sitting idle. And based on cash flow projections and sales trends, which includes 22% aggregate growth in services, this stock is worth (at least) $30 per share.

The article It’s Time to Buy the “New” Cisco originally appeared on Fool.com and is written by Richard Saintvilus.

Fool contributor Richard Saintvilus has no position in any stocks mentioned. The Motley Fool recommends Check Point Software (NASDAQ:CHKP) Technologies, Cisco Systems, F5 Networks, Riverbed Technology, and VMware. The Motley Fool owns shares of Check Point Software Technologies, F5 Networks, Riverbed Technology, and VMware.

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