Shares of Cisco Systems, Inc. (NASDAQ:CSCO) are up 2.4% to trade at $40.47, thanks to some bullish analyst attention ahead of earnings this week. Specifically, Instinet upgraded CSCO stock to "buy" and hiked its price target to $46, stating, "We believe Cisco's webscale switching wins are durable and its window for a campus switching refresh will extend through 2019." The analyst also hiked quarterly earnings and sales growth estimates for Cisco ahead of Wednesday's earnings release.
CSCO stock pulled back with the broader equities market to start February, but is now pacing to close atop its 10-day moving average for the first time this month. Just two weeks ago, the shares touched a 16-year high of $42.98. Even with the recent pullback, Cisco shares have added more than 29% in the past year. Not to mention that CSCO is typically among the best stocks to buy after a big stock market sell-off.
Despite the equity's long-term uptrend, the average 12-month price target on CSCO stands at $42.02 -- a premium of just 3% to the stock's current perch, and a discount to its recent high. Should Cisco Systems report stronger-than-expected earnings later this week, additional price-target hikes could lure more buyers to the table.
Over the past eight quarters, CSCO has averaged a one-day post-earnings move of 4.7%, regardless of direction. This time around, the options market is pricing in a bigger-than-expected one-day move of 9%, per the stock's at-the-money implied volatility data. Furthermore, the equity's Schaeffer's Volatility Scorecard (SVS) of 85 indicates Cisco shares have exceeded options traders' volatility expectations in the past year.