Cisco Systems (CSCO) Hits A New 52-Week High Of $29.70

Shares of technology company Cisco Systems (NASDAQ:CSCO) hit a new 52-week high of $29.70 on Jul 11, eventually closing at $29.43. The company returned 5.9% in one year and delivered a year-to-date return of roughly 8.4%. Average volume of shares traded over the last three months was roughly 23,479K.

What is Driving Cisco?

Cisco is the leading provider of IP-based networking and other products and has a well-diversified business. The company stands to benefit from its recent successful ventures including its “Internet of Everything” campaign and a cloud-based service called the Intercloud that connects private, public and hybrid clouds. Additionally, the company is poised to grow on its drive toward cloud computing and increasing data flow on carrier and computing networks.

Moreover, the company gained momentum from strong fundamentals and its recent announcement that it plans to acquire a cloud-based security company, CloudLock, for $293 million in cash and stock. The buyout will enhance Cisco’s current cloud security offerings through increased visibility and threat awareness of CloudLock’s cloud delivered platform. The purchase will help the network equipment maker to broaden its efforts as well as meet changing compliance and security needs.

The price appreciation may also be attributed to Cisco’s recent collaboration with International Business Machines Corporation (NYSE:IBM) . This partnership aims at integrating Cisco Spark and WebEx platforms with IBM's cloud collaboration solutions that include Verse and Connections. This collaboration of analytics and cognitive technology is expected to make business communication more productive and data-driven, thereby saving communication time and effort, and in turn increasing Cisco’s market share.

Moreover, we remain positive on the company’s strong cash position and ability to service its long-term debts. Moreover, continuous share buybacks and dividend increase will inspire investors’ loyalty through high returns.

In the trailing four quarters, the company delivered an average positive earnings surprise of nearly 7.07%. Cisco’s strong revenue growth, solid financial conditions, growth in areas like cloud computing, mobile, data center as well as strong long-term growth potential position it favorably.

Cisco is expected to report fourth-quarter fiscal 2016 results on Aug 17.

Currently, Cisco has a Zacks Rank #2 (Buy).

Other Stocks to Consider

A couple of equally-ranked stocks in the same space are Semiconductor Manufacturing International Corp. (NYSE:SMI) and Amkor Technology, Inc. (NASDAQ:AMKR) .