Credit Suisse Offered Unique Double Upgrade to Cisco

Credit Suisse Offered Unique Double Upgrade to Cisco

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Cisco Systems received a spectacular double upgrade on stock market thanks to tax reform announcement.

Cisco Systems Inc. with the headquarters in the center of Silicon Valley has just experienced an incredible transformation. The American tech company specialized in modern branches such as the Internet of Things, energy management, and cyber security. It is the world’s biggest networking conglomerate, and it is an important asset in market indexes such as Dow Jones Industrial Average, NASDAQ, and S&P 500. As of recently, Credit Suisse changed its rating on Cisco and performed a unique double upgrade.

Analyst Kulbinder Garcha Pulled a 180 Degrees Change for Cisco and Managed a Double Upgrade

The change of rating came right after President Donald Trump revealed the first concise strategy for a tax reform. The Swiss multinational financial firm was confident that the new political endeavors are going to boost the performance of companies such as Cisco Systems. As a consequence, it is in investors’ interest to buy shares into the tech giant and take advantage of the shareholder return program.

Thus, Credit Suisse decided to change its rating on Cisco Systems by 180 degrees. The holding company took Cisco out of its underperform list and moved it two levels upwards right to its outperform category. Analyst Kulbinder Garcha at Credit Suisse was a notorious specialist against computer network equipment. However, the latest moves within the White House managed to change his mind completely. As such, Garcha became a firm believer in Cisco Inc.

Cisco CEO Intends to Divert the Company to a Software Business

As a consequence, Kulbinder Garcha increased his target price for Cisco at $40. By comparison, the company traded for the entire month at $34 while the stock didn’t manage to surpass the $30 threshold for years. Garcha perceived a new trend among organizations. They started for some time moving their business assets on cloud computing. As a consequence, corporations need fewer IT products than ever before. This movement brought only bad news for Cisco.

However, Garcha trusts CEO Chuck Robbins. The executive intends to transform his company into a software business with ramifications in numerous domains. Moreover, the new tax reform will allow the company to bring in U.S. its overseas stash thanks to minimum taxes. The value of these funds is expected to be somewhere at $75 billion.

“In an environment of tax reform, we believe the company has the capacity to accelerate the company’s transition towards a diversified IT player.”

Thus, with an innovative leadership approach and rich funds for mergers and acquisitions, investors are going to thrive along Cisco. As such, everyone is looking forward to seeing Cisco quarterly report on May 17.

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