Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

Cisco Systems, Inc. (CSCO)

Company Dividend Discount ModelIndustry: Communication EquipmentSector: Technology

Valuation Snapshot

Stable Growth$24.63 - $38.22$30.92
Multi-Stage$42.47 - $46.57$44.48
Blended Fair Value$37.70
Current Price$70.63
Upside-46.62%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS1.36%4.65%1.611.601.581.561.541.501.501.491.381.19
YoY Growth--0.83%1.30%1.25%0.99%2.44%0.62%0.18%8.29%16.02%16.25%
Dividend Yield--2.28%2.86%3.06%3.41%2.75%3.88%3.19%3.37%4.00%3.88%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)10,329.00
(-) Cash Dividends Paid (M)6,462.00
(=) Cash Retained (M)3,867.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)2,065.801,291.13774.68
Cash Retained (M)3,867.003,867.003,867.00
(-) Cash Required (M)-2,065.80-1,291.13-774.68
(=) Excess Retained (M)1,801.202,575.883,092.33
(/) Shares Outstanding (M)3,998.503,998.503,998.50
(=) Excess Retained per Share0.450.640.77
LTM Dividend per Share1.621.621.62
(+) Excess Retained per Share0.450.640.77
(=) Adjusted Dividend2.072.262.39
WACC / Discount Rate7.77%7.77%7.77%
Growth Rate-0.57%0.43%1.43%
Fair Value$24.63$30.92$38.22
Upside / Downside-65.12%-56.22%-45.89%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)10,329.0010,373.2810,417.7610,462.4210,507.2810,552.3210,868.89
Payout Ratio62.56%68.05%73.54%79.02%84.51%90.00%92.50%
Projected Dividends (M)6,462.007,058.957,660.918,267.908,879.959,497.0910,053.73

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate7.77%7.77%7.77%
Growth Rate-0.57%0.43%1.43%
Year 1 PV (M)6,484.816,550.036,615.25
Year 2 PV (M)6,465.396,596.096,728.10
Year 3 PV (M)6,410.126,605.486,804.77
Year 4 PV (M)6,324.686,582.986,849.12
Year 5 PV (M)6,214.076,532.906,864.70
PV of Terminal Value (M)137,916.70144,993.07152,356.97
Equity Value (M)169,815.76177,860.56186,218.91
Shares Outstanding (M)3,998.503,998.503,998.50
Fair Value$42.47$44.48$46.57
Upside / Downside-39.87%-37.02%-34.06%

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