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International Business Machines Corp. (IBM), Cisco Systems, Inc. (CSCO): What Are The Potential Catalysts?

So how will Cisco capitalize on this?

Cisco has been called the “backbone of the Internet” and will be one of the companies that benefits the most from an internet-connected world. The company is also aggressively getting into another internet-related industry that should continue to rapidly grow — security.

The company is pushing into security to modernize the connection grid. According to a press release, Cisco’s Connected Grid Security Architecture “is a blueprint that simplifies policy administration, strengthens security controls and gives business more flexibility and increased visibility into operations.”

With everything connected to the Internet, security (especially relating to critical infrastructure, such as utilities) will need to be increased, and Cisco is taking advantage to fulfill this need and looking to become the leader.

The bottom line

Cisco is still ridiculously cheap, even in relation to its peers in the old tech world, who recently lagged the market significantly.

P/E Forward P/E Dividend (Yield)
CSCO 11.72 9.70 $0.68 (3.30%)
MSFT 17.19 10.85 $0.92 (2.70%)
INTC 12.07 11.9 $0.90 (3.80%)
IBM 14.04 11.10 $3.80 (1.90%)

In relation to earnings, Cisco is the cheapest “ remnant” both now and going forward.

Cisco stands out as not only one of the only “old school” tech companies that hasn’t started to run-up, but also as one of the few Dow components that hasn’t shot up yet as well. Collecting the nice 3.30% dividend that Cisco currently offers while waiting for capital appreciation should also pay off, like it did for investors who purchased Microsoft Corporation (NASDAQ:MSFT) before its recent run-up. Microsoft yielded well over 3% before its earnings inspired price increase.

Scoop up some shares of Cisco now and get paid nicely to wait — before the market realizes Cisco’s true intrinsic value and future prospects.

Joseph Harry owns shares of International Business Machines., Microsoft, and Cisco Systems. The Motley Fool recommends Cisco Systems. The Motley Fool owns shares of International Business Machines. and Microsoft.

The article Grab Shares of This Tech Giant While They Are Still Cheap originally appeared on

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