Cisco Stock Has Staged Quite the Bounce

Cisco stock gapped lower on Nov. 18

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Three weeks ago, Cisco Systems, Inc. (NYSE:CSCO) was mired in supply chain woes. Heading into the end of 2021, how should investors approach the blue-chip tech stock? 

Cisco stock has rallied back from that mid-November bear gap to test the $58 level once more. Year-to-date, CSCO is up 29%, but there's not a lot of pessimism around the stock that could fuel additional upside; a slim 1% of the stock's total available float is sold short. After a thorough fundamental analysis, Cisco stock offers the most opportunity as a dividend stock, with  a forward dividend of $1.48 with a dividend yield of 2.60%.

CSCO trades at a slightly high price-earnings ratio of 21.59 but Cisco stock has a forward price-earnings ratio of 16.37, which is a decent value given the tech company’s huge market capitalization of $245 billion. In addition, Cisco Systems has a strong balance sheet with $23.35 billion in cash and $10.69 billion in total debt, making CSCO a secure long-term investment. In general, the only true fundamental downfall when considering investing in Cisco stock is its stagnant top and bottom-line growth.

 

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