We recently compiled a list of the 12 Best Internet of Things Stocks To Buy According to Analysts. In this article, we are going to take a look at where Cisco Systems, Inc. (NASDAQ:CSCO) stands against the other IoT stocks.
Trends and Outlook for The Internet of Things Industry
According to the IOT analytics, 2024 was a poor year for the Internet of Things sector, particularly due to the headwinds from the hardware sector. As per the report published on January 15, many IoT-centric industries experienced stunted year-over-year growth. The industrial software market grew 12% year-over-year, slightly slower than the growth in 2023, whereas the industrial hardware industry experienced market declines. However, despite the slowdown the number of IoT connected devices grew around 13% year-over-year, surpassing 18 billion. In addition, the expertise spending related to IoT also increased by 10% year-over-year to reach $298 billion in 2024. The report also highlighted that the discussion on IoT remained high among leading CEO’s of the technology industry. The public relevance of the term Internet of Things remained within 30% of its all-time high in 2022.
Read Next: 10 Worst Performing Bank Stocks in 2024 and 12 Best FMCG Stocks To Buy According to Hedge Funds.
Moreover, another report by McKinsey & Company states that IoT can offer significant economic value potential. The report highlights that IoT can unlock $5.5 trillion to $12.6 trillion in economic value by consumer IoT products and services. McKinney & Company predicts that the most economic value of the technology will come from its deployment in industrial environments including manufacturing, health care, and other areas. Factory setting is expected to be the largest beneficiary by generating around $1.4 trillion to $3.3 trillion by 2030, or 26% of the total value. Lastly, the perceived value of IoT, the technological advancements, and the emergence of 5G in Networking are anticipated to be the prominent tailwinds for the sector.
Our Methodology
To compile the list of the 12 best Internet of Things stocks to buy according to analysts we used the Global X Internet of Things ETF. Using the ETF we aggregated a list of IoT stocks with positive analyst upside potential (at least 10%), sourced from CNN. Lastly, we ranked the stocks in ascending order of the analyst upside potential. Please note that the data was retrieved on Monday, 17th February, 2025.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Engineers using the latest Cisco TelePresence technology to collaborate with colleagues around the world.
Cisco Systems, Inc. (NASDAQ:CSCO)
Analyst Upside Potential: 10.99%
Cisco Systems, Inc. (NASDAQ:CSCO) is a leading technology company that specializes in designing and selling a wide range of products and services related to networking, security, collaboration, applications, and cloud computing. Its products enable businesses, government institutes, and other enterprises to embrace digital transformation through tools like the IoT Control Center, which manages connectivity for devices across different wireless technologies.
The company generates two-thirds of its revenue from its services in the networking industry where it sells routing devices, server products, switches, and other related software products. These products help enterprises transform digitally. Cisco Systems, Inc. (NASDAQ:CSCO) is benefiting from the trends of digital transformation among businesses, during the fiscal second quarter of 2025, its enterprise orders rose 27%, showing double-digit growth across all geographic regions. In addition, the public sector orders also grew 13% year-over-year across all geographic regions.
Deutsche Bank raised its price target on Cisco Systems, Inc. (NASDAQ:CSCO) from $57 to $65, while keeping its hold rating. The firm increased its price target after the company delivered encouraging results in the second quarter of 2025. It is one of the best Internet of Things stocks to buy according to analysts.
GreensKeeper Asset Management stated the following regarding Cisco Systems, Inc. (NASDAQ:CSCO) in its Q3 2024 investor letter:
“In the third quarter, we decided to exit our investment in Cisco Systems, Inc. (NASDAQ:CSCO), as we believed the stock had become fully valued and reallocated the capital to one of our international positions. We also initiated a new position in a Canadian company shortly after the quarter ended. As we may still accumulate shares, we will defer discussing this new holding for the time being. Our top ten positions are detailed in the table below. Further portfolio disclosures, including performance statistics, are available on the pages immediately following this letter.”
Overall CSCO ranks 12th on our list of the best IoT stocks to buy according to analysts. While we acknowledge the potential of CSCO as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CSCO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure: None. This article is originally published at Insider Monkey.
Hedge Fund Resource Center