CSCO

Teradyne TER is set to report its third-quarter 2026 results on Oct. 27, 2026. For the third quarter of 2026, Teradyne expects revenues in the range of $1.20-$1.30 billion. Non-GAAP earnings are expected to be between $1.85 and $2.15 per share. The Zacks Consensus Estimate for earnings is currently pegged at $2.04 per share, which has been unchanged over the past 30 days. This indicates a 140% increase from the figure reported in the year-ago quarter. The consensus mark for revenues is pegged at $1.27 billion, suggesting an increase of 65.20% from the year-ago quarter's reported numbers. Teradyne's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 20.93%. Teradyne, Inc. price-eps-surprise | Teradyne, Inc. Quote Let's see how things have shaped up for the upcoming announcement. Teradyne's third-quarter performance is expected to have benefited from robust demand for semiconductor testing solutions, driven by accelerating artificial intelligence (AI) infrastructure investments. Strong demand for high-bandwidth memory (HBM), DRAM and NAND testing solutions is expected to have driven growth in the company's Memory Test business. Increasing capacity investments by memory manufacturers and the growing complexity of advanced memory technologies are expected to have benefited the company's topline in the quarter to be reported. The company's Industrial & System Test business is expected to have benefited from increasing demand for hard disk drive (HDD) testing solutions, fueled by AI data center storage requirements. Growing HDD demand from major storage manufacturers and increasing exabyte shipments are expected to have supported revenues. Improving demand for automotive and industrial semiconductor testing solutions, particularly power management devices used in AI data centers, is another positive. Teradyne's Product Test business is expected to have benefited from increasing adoption of its Omnyx production board testing platform and Multilane Test Products' high-speed interconnect testing solutions. Rising demand for optical testing, networking and data center infrastructure solutions is expected to have supported growth. The Robotics business is likely to have benefited from increasing automation investments across electronics manufacturing, semiconductor production and AI data center assembly operations. However, Teradyne's third-quarter performance is expected to have suffered from softer compute testing revenues due to the timing of customer orders. Several hyperscaler and networking customers completed significant capacity expansions during the first half of 2026, with the next major investment cycle expected in early 2027. Weakness in mobile semiconductor testing demand is another concern. An unfavorable product mix, new product introductions and pricing pressure in memory testing are expected to have weighed on profitability. Higher research and development expenses and go-to-market investments could further constrain operating margins. Management expects third-quarter gross margins of 58-59%, down from 59.8% in the second quarter. Teradyne shares have surged 59.5% in the year-to-date period, outperforming the Zacks Computer & Technology sector's growth of 18% and the Zacks Electronics - Miscellaneous Products increase of 20.6%. TER shares have also outperformed their peers, including Cisco Systems CSCO, Vertiv VRT and KLA KLAC. All three companies are expanding their footprint in the AI infrastructure space. Cisco Systems, Vertiv, and KLA shares have gained 36.1%, 20.7%, and 21.6% in the year-to-date period, respectively. Image Source: Zacks Investment Research Teradyne's stock is not so cheap, as the Value Score of D suggests a stretched valuation at this moment. In terms of the forward 12-month Price/Sales, Teradyne is trading at 8.22X, higher than the industry's 7.26X, Cisco Systems' 5.26X, and Vertiv's 4.35X. However, it is lower than KLA's 10.19X. Image Source: Zacks Investment Research Teradyne is benefiting from robust demand for semiconductor testing solutions as AI infrastructure investments accelerate. Rising demand from AI component suppliers, including GPU, CPU, HBM, and networking chip manufacturers, is driving growth across its Semiconductor Test business. Increasing chip complexity and advanced packaging requirements are creating additional testing opportunities. In the second quarter of 2026, Teradyne's Semiconductor Test revenues increased 128% year over year, supported by strong AI-related demand. Compute revenues surged nearly 600% year over year, while memory revenues reached $212 million, driven by robust demand for HBM, DRAM and NAND testing solutions. AI-driven revenues accounted for more than 60% of total sales, highlighting the company's increasing exposure to AI infrastructure investments. Teradyne's memory business is another key growth driver. Memory test revenues reached $212 million in the second quarter of 2026, supported by strong HBM and DRAM demand and recovering NAND investments. The company expects the memory testing market to expand more than 40% in 2026, creating additional revenue opportunities. Teradyne expects the automated test equipment market to reach or exceed $20 billion by the end of the decade. Sustained AI infrastructure investments and expanding testing requirements also support Teradyne's long-term growth prospects. Teradyne's robust and diversified portfolio to meet the rising demand for AI-driven technologies is contributing to its growth prospects continuously. These factors have justified its premium valuation. TER stock currently sports a Zacks Rank #1 (Strong Buy), which implies that investors should start accumulating the stock right now. You can see the complete list of today's Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Teradyne, Inc. (TER) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report KLA Corporation (KLAC) : Free Stock Analysis Report Vertiv Holdings Co. (VRT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). 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Texas Instruments Incorporated TXN reported third-quarter 2026 earnings of $2.62 per share, which increased 77% year over year. The bottom line beat the Zacks Consensus Estimate by 9.2%. TXN posted revenues of $6.06 billion, which rose 28% from the year-ago quarter. The top line surpassed the consensus mark by 2.2%, driven by broad-based growth across industrial, automotive and data center markets. Data center revenues surged approximately 95% year over year. Texas Instruments' third-quarter results reflected strong growth across its Analog and Embedded Processing segments, supported by improving demand conditions across key end markets. Analog revenues came in at $4.91 billion (81.1% of total revenues), which grew 32% from the year-ago quarter. The figure came above our model estimate of $4.79 billion. The segment's operating profit increased 69% year over year to $2.51 billion, benefiting from stronger demand and improving manufacturing utilization. Texas Instruments Incorporated price-consensus-eps-surprise-chart | Texas Instruments Incorporated Quote Embedded Processing revenues totaled $858 million (14.2% of total revenues), reflecting 21% year-over-year growth. The figure surpassed our model estimate of $823.1 million. The segment's operating profit surged 110% to $227 million, supported by improving profitability as the business continued its cyclical recovery. The Other segment generated $286 million in revenues (4.7% of total revenues), declining 6% from the prior-year quarter. The figure missed our model estimate of $293.9 million. The segment's operating profit increased 106% to $142 million. Industrial revenues increased more than 40% year over year and approximately 10% sequentially, supported by demand across aerospace and defense, energy infrastructure, test and measurement, and robotics. Automotive revenues grew at a mid-teens percentage rate year over year and approximately 10% sequentially. Management highlighted improving customer demand, particularly in China and the United States, alongside increasing semiconductor content in hybrid electric and powertrain systems. Data center revenues increased approximately 20% sequentially, reflecting sustained investments in computing infrastructure. Personal electronics revenues remained approximately flat year over year but increased at an upper-single-digit rate sequentially. Communications equipment revenues grew both year over year and sequentially. Texas Instruments' gross profit increased 42.7% year over year to $3.89 billion. Gross margin expanded approximately 680 basis points (bps) year over year to 64.2%, benefiting primarily from higher revenues, alongside favorable pricing, manufacturing loadings and product mix. Selling, general and administrative expenses increased 4.2% year over year to $476 million. As a percentage of revenues, SG&A expenses contracted approximately 180 bps to 7.9%. Research and development expenses increased 2.3% year over year to $530 million. As a percentage of revenues, R&D expenses declined approximately 220 bps to 8.8%. Operating profit surged 72.8% year over year to $2.87 billion. Operating margin expanded approximately 1,240 bps to 47.5%. Texas Instruments continued expanding manufacturing capacity to support rising semiconductor demand. Management highlighted its investments in 300mm wafer manufacturing and assembly and test operations as key competitive advantages. The company is ramping manufacturing operations in Malaysia while expanding capacity at its Lehi facilities. Management also highlighted improving Analog pricing during the second half of 2026, supported by stronger demand and tighter industry supply conditions. Capital expenditure plans for 2026 remain between $2 billion and $3 billion, with spending potentially approaching the higher end depending on equipment delivery schedules. As of Sept. 30, 2026, cash and short-term investments totaled $8.14 billion. Long-term debt stood at $12.91 billion, while the current portion of long-term debt was $650 million. Texas Instruments generated operating cash flow of $3.42 billion during the quarter, while capital expenditures totaled $463 million. Quarterly free cash flow reached $2.96 billion. During the quarter, TXN repurchased shares worth $48 million and paid $1.30 billion in dividends. The company also repaid $500 million in debt. Trailing 12-month free cash flow increased 249% year over year to $8.42 billion. Management announced a 7% dividend increase to $1.52 per share, marking its 23rd consecutive annual dividend increase. Management expects fourth-quarter 2026 revenues between $5.80 billion and $6.30 billion, with a midpoint of $6.05 billion. Texas Instruments anticipates earnings per share between $2.45 and $2.79. The company expects an effective tax rate of approximately 13% for the fourth quarter and 13-14% for 2027. Management expects industrial, automotive and data center demand to support fourth-quarter performance. Continued strength in data center infrastructure investments and industrial recovery underpins the company's outlook, while manufacturing capacity expansion remains a key operational priority. Currently, TXN carries a Zacks Rank #2 (Buy). Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI , Applied Materials AMAT and Cisco Systems CSCO , each carrying a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Shares of Analog Devices have rallied 49.7% year to date. The Zacks Consensus Estimate for ADI's fiscal 2026 earnings is pegged at $13 per share, up by 4 cents over the past seven days, indicating an increase of 66.9% year over year. Shares of Applied Materials have jumped 59.1% year to date. The Zacks Consensus Estimate for AMAT's fiscal 2026 earnings is pegged at $12.79 per share, unchanged over the past 30 days, indicating a rise of 35.8% year over year. Cisco Systems shares have surged 39.2% year to date. The Zacks Consensus Estimate for CSCO's fiscal 2027 earnings is pegged at $5.11 per share, unchanged over the past 30 days, indicating an increase of 18% year over year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Texas Instruments Incorporated (TXN) : Free Stock Analysis Report Analog Devices, Inc. (ADI) : Free Stock Analysis Report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Applied Materials, Inc. (AMAT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Cisco Systems, Inc. (NASDAQ:CSCO) has an opportunity to turn artificial-intelligence infrastructure spending and network upgrades into stronger cash generation. Fiscal-2026 net income increased 30% to $13.3 billion, but operating cash flow stayed near $14.2 billion. Reported earnings also benefited from higher unrealized investment gains, which increased profit without generating operating cash. Cisco's cybersecurity business adds another growth avenue as companies strengthen their defenses against evolving threats. Find our rankings of cybersecurity stocks here. Cisco Systems, Inc. (NASDAQ:CSCO) trades at approximately 20x forward earnings and 32x trailing earnings. The earnings outlook combines operating growth with accounting exclusions. Fiscal-2027 guidance calls for GAAP EPS of $4.00–$4.06, against $3.33 in fiscal 2026, and company-defined non-GAAP adjusted EPS of $5.05–$5.11. Adjustments include stock compensation, acquisition-related amortization, and restructuring. The lower forward multiple should not be read as pure profit growth. Arista Networks, Inc. (NYSE:ANET) is the closest operating comparison because it competes in network switching. Its 45.4% second-quarter GAAP operating margin sets a high profitability benchmark for Cisco Systems, Inc. (NASDAQ:CSCO). Hewlett Packard Enterprise Company (NYSE:HPE) has greater server exposure, and its inventory commitments create a different cash-conversion test. The 20x forward valuation looks reasonable only if its fourth-quarter cash rebound persists. Cisco Systems, Inc. (NASDAQ:CSCO) benefits from established enterprise networks, customer relationships, and the cost of replacing integrated equipment and software. Management says more than half its customers purchase both campus and data-center networking. That breadth creates opportunities to sell upgrades into existing relationships and spread development and support expenses across more revenue. Billionaire Ken Fisher also holds a position in Cisco, reflecting investor interest in the networking company. See which other AI stocks are on the billionaire's radar. AI demand strengthens that opportunity. Cisco Systems, Inc. (NASDAQ:CSCO) booked $9.3 billion in hyperscaler AI infrastructure orders in fiscal 2026 and recognized about $4 billion in associated revenue. Management expects $7.5 billion of AI infrastructure revenue in fiscal 2027. The difference between bookings and sales matters because large AI orders can arrive well before shareholder cash. Revenue guidance of $72.2 billion–$73.4 billion implies approximately 15% growth at the midpoint. The adjusted EPS midpoint implies about 17% growth from fiscal-2026 adjusted EPS of $4.33. Those forecasts require operating leverage as shipments increase, while memory shortages and higher component prices can absorb part of the benefit. Subscription revenue gives Cisco Systems, Inc. (NASDAQ:CSCO) a recurring base, but it increased only about 1% to $32.0 billion in fiscal 2026. Maintaining that base supports investment; it does not yet establish accelerating software cash growth. Hardware expansion still requires inventory purchases before customer payments arrive, and competitive pricing can limit the profit retained from additional shipments. Cisco Systems, Inc. (NASDAQ:CSCO) generated $5.4 billion of fourth-quarter operating cash flow, up 27%. That is meaningful evidence against treating the annual cash plateau as permanent. Fiscal 2026 also included the final $2.3 billion U.S. transition-tax payment, removing one specific future cash obligation. Working capital nevertheless remains demanding. Annual inventory and financing-receivable movements absorbed approximately $2.5 billion and $1.8 billion, respectively. Both continued consuming cash in the fourth quarter, when their combined use approached $2.8 billion. Higher deferred revenue and other liabilities helped offset those demands. The rebound did not come from releasing inventory or collecting down customer financing. Offering payment flexibility can support equipment sales, but customer financing earns its keep only when collections justify the risk. Persistently larger financing balances would tie up capital and reduce the cash available for distributions, even if reported sales and earnings continued growing. Non-GAAP free cash flow, defined as operating cash flow less purchases of property and equipment, declined 4% to $12.8 billion as capital spending increased. Dividends and buybacks consumed approximately 99% of that amount. Sustaining distributions alongside growth investment therefore depends on better conversion, not simply higher accounting profit. Cisco Systems, Inc. (NASDAQ:CSCO) produced $13.3 billion of free cash flow in fiscal 2025 before the latest decline. The business has demonstrated substantial cash generation, but stronger AI demand now brings heavier funding requirements. At 20x forward earnings, shareholders need growth that increases cash after those commitments. More sales alone would provide little valuation protection if funding needs absorbed the additional profit. Cisco Systems, Inc. (NASDAQ:CSCO) looks reasonably valued at 20x forward earnings if the fourth-quarter cash recovery becomes sustained growth. Installed relationships and stronger infrastructure demand make that outcome credible. It requires earnings growth to produce more cash after investment, with inventory and financing needs growing more slowly than sales. Continued working-capital expansion alongside flat free cash flow would make the valuation demanding, even if orders remained strong. While we acknowledge the potential of CSCO as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: Dell (DELL) Reports $60.9B of AI Server Orders and a $95B Backlog. Can the Demand Surge Produce Durable Cash Flow? and Viasat (VSAT) Adds Satellite Capacity. Can it Generate More Cash? This article is originally published at Insider Monkey.

Arista Networks, Inc. (NYSE:ANET) and Cisco Systems, Inc. (NASDAQ:CSCO) are both benefiting as AI clusters turn networking into a larger part of the data-center bill. Arista is growing much faster, but investors are paying about 43.8 times forward earnings for that growth versus roughly 20.7 times for Cisco. That valuation gap makes the pair more interesting than a simple old-guard versus disruptor story. Recent security work showed that both companies must keep AI networks reliable after deployment, while Arista's 1.6T platform push shows why hyperscale AI fabrics remain its core growth engine. The portfolio question is whether Arista's superior economics justify more than twice Cisco's earnings multiple. Arista's second-quarter revenue rose 37.7% to $3.04 billion, its first quarter above $3 billion. Non-GAAP operating margin reached 49.9%, and non-GAAP EPS increased about 40%. Management guided third-quarter revenue to roughly $3.3 billion. Those numbers explain the premium. Arista has become deeply embedded in hyperscale cloud and AI fabrics, while its software-led operating model produces margins more typical of software than traditional networking hardware. The bear case is concentration. A relatively small number of cloud customers drive a large share of demand, and a 44 times forward earnings multiple assumes AI networking growth stays elevated. Cisco is no longer merely a defensive networking incumbent. Fiscal fourth-quarter revenue grew 18%, networking product orders rose 40%, and hyperscaler AI infrastructure orders reached $4 billion in the quarter and $9.3 billion for the year. Cisco said AI infrastructure revenue was roughly $4 billion in fiscal 2026 and expects about $7.5 billion in fiscal 2027. That acceleration makes its 20.7 times forward earnings multiple more interesting. Cisco also trades around 33 times free cash flow versus roughly 50 times for Arista. Cisco still grows more slowly, and its broader enterprise portfolio can dilute the impact of AI wins. But security, observability and networking give it several ways to monetize the same customer relationships, while the lower multiple requires less perfection. Hedge-fund ownership increased for both companies in Q2. Arista rose to 91 holders from 85, although Arrowstreet Capital reduced its stake 10% to 7.62 million shares. Cisco increased to 101 holders from 97, while Fisher Asset Management nearly doubled its position, up 94% to 33.4 million shares. As of August 31, 14.51 million Arista shares were sold short, 1.18% of float, with about 2.5 days to cover. Arista remains the better business on growth and margins. At today's prices, Cisco offers the better risk-adjusted stock setup because its AI revenue is accelerating while its valuation leaves far more room for execution that is merely good rather than exceptional. While we acknowledge the potential of ANET and CSCO as investments, we believe certain other AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. Disclosure: None. Follow Insider Monkey on Google News.

Interested in Oracle Corporation? Here are five stocks we like better. Screening for dividend yield, earnings growth, and analyst support together can help investors avoid some of the weaknesses that come with relying on a single metric. Oracle, British American Tobacco, Cisco Systems, Charles Schwab, and Goldman Sachs all meet those criteria despite spanning three very different sectors. The group ranges from AI infrastructure exposure to high-yield tobacco and capital-markets plays, showing how the same screen can uncover very different investment profiles. Sometimes, the best stock ideas often come from combining screens rather than chasing a single trait or variable. For example, a stock with a high yield alone can signal a business in decline. Rapid earnings growth on its own could come with a nosebleed valuation. And a wall of analyst Buy ratings means little if the fundamentals do not back it up. But when a stock offers all three at once—a real dividend, genuine earnings growth, and the backing of Wall Street's analysts, it tends to be worth a closer look. The five names below clear that bar, spanning technology, finance, and consumer staples and giving investors a diversified starting point rather than a bet on one corner of the market or a single screening variable. → These 3 AI Stocks Sold Off Hard—Even as Their Outlooks Improved Oracle (NYSE: ORCL) is the most contrarian name on this list, and potentially the most intriguing, and even explosive. The database and cloud infrastructure giant has had a rough year, with the stock down more than 24% as investors soured on its spending pace and amid some high-profile stumbles in its cloud buildout. That weakness, however, is exactly what has created the opportunity analysts now see. Despite the pullback, Oracle's fundamentals remain formidable. The company generates net margins above 26% and a return on equity approaching 49%. Analysts project nearly 37% earnings growth in the year ahead as its cloud infrastructure business scales to meet AI demand. It pays a dividend yielding almost 1.4%, and it ranks in the 100th percentile of MarketBeat's technology sector. The headline number, though, is the analyst price target. Oracle's consensus target of $252.58 implies more than 70% upside from current levels, by far the widest on this list, with a Moderate Buy consensus across 41 analysts. This name may require patience, but for investors willing to buy a dominant franchise while it is out of favor, the risk-reward is compelling. → Insiders Signal Deep Value In DICK’s Sporting Goods British American Tobacco (NYSE: BTI) is the income powerhouse on this list. The global tobacco company behind brands like Dunhill, Lucky Strike, and Camel offers a dividend yield of 5.87%, the highest here by a wide margin, backed by the enormous, reliable cash flows the tobacco industry is known for. For income-focused investors, that yield alone makes the stock worth a look. But British American Tobacco is more than just a yield play these days. The company's transition toward smokeless and reduced-risk products has begun to pay off, and analysts at Jefferies recently pointed to that shift as a driver of faster growth ahead. Earnings are projected to grow around 8% in the year to come, modest compared to the tech names here, but paired with that near-6% yield, the total-return math becomes attractive. The stock carries a Moderate Buy consensus and a price target of $68.10, implying roughly 22% upside, and with a beta of just 0.30, it offers stability that is rare in this market. For investors who want to get paid handsomely while they wait, British American Tobacco fits the mold. → Coach’s Momentum Powers Tapestry Despite the Stock’s Sharp Pullback Cisco Systems (NASDAQ: CSCO) has staged one of the more impressive comebacks in large-cap technology this year, with the stock up more than 42%. Long dismissed as a slow-growth legacy name, Cisco has reinvented itself as a key supplier of the networking backbone AI data centers depend on, and its 2024 acquisition of Splunk has bolstered its position in cybersecurity and data observability at exactly the right moment. The renewed momentum in the name is backed by real analyst enthusiasm. Cisco holds a Moderate Buy consensus with a price target of $129.68, implying more than 18% upside even after its strong run. It ranks in the 99th percentile of MarketBeat's technology sector and pays a well-supported dividend yielding around 1.5%. With projected earnings growth of roughly 8% and a central role in the AI infrastructure buildout, Cisco offers a rare combination of income, stability, and genuine exposure to the market's most powerful theme. It is proof that some of the oldest names in tech can still find a new gear. Charles Schwab (NYSE: SCHW) may be the most well-rounded name on this list. The brokerage and wealth-management giant has quietly climbed 5% this year, bringing together essentially every trait this screen is looking for: a growing dividend, strong projected earnings growth, and firm analyst support. As markets have stayed active and investors have poured into equities, Schwab's enormous client asset base has translated into robust, recurring revenue. The fundamentals are excellent, with net margins near 39% and projected earnings growth above 21%, among the strongest in the sector. Schwab yields around 1.2% and ranks in the 98th percentile of MarketBeat's finance sector. Its consensus price target of $121.17 suggests roughly 15% upside, backed by a Moderate Buy rating from 21 analysts. For investors seeking a single name that balances income, growth, and quality without leaning too heavily on any one of them, Schwab appears to be a natural fit. Goldman Sachs (NYSE: GS) rounds out the list as the value-and-income play among the financials. Wall Street's premier investment bank has climbed more than 7% this year, benefiting from a booming environment for dealmaking, trading, and capital markets activity. Yet despite that strength, the stock trades at a modest price-to-earnings ratio of under 15, cheap relative to the broader market. That combination of a low valuation and a booming business is what makes Goldman attractive here. The bank pays a dividend yielding around 2.1%, the second-highest on this list, with a strong dividend rating reflecting years of consistent growth. Analysts hold a Moderate Buy consensus and a price target of $1,062.86, implying nearly 13% upside potential. Earnings growth is more modest than that of the tech names. Still, for a best-in-class financial trading at a discount while returning significant capital to shareholders, Goldman offers a compelling blend of value and income. When a franchise this dominant trades this cheaply, it tends to reward patient shareholders. What stands out most is how differently these five got here. Oracle is a fallen giant trading well below analysts’ consensus target; British American Tobacco pairs a high yield with a shift toward smokeless products; Cisco has found a new growth driver in the AI buildout. Schwab and Goldman Sachs bring two different financial-sector profiles to the same screen. That variety is the point. These companies span technology, finance, and consumer staples, yet each combines income, projected earnings growth, and analyst support. Price targets can miss, and fundamentals can change, but when all three traits line up, the stock has earned a closer look. The article "5 Dividend Stocks That Combine Income, Earnings Growth, and Wall Street Support" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

A month has gone by since the last earnings report for Cisco Systems (CSCO). Shares have lost about 5.3% in that time frame, underperforming the S&P 500. Will the recent negative trend continue leading up to its next earnings release, or is Cisco due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Cisco Systems, Inc. before we dive into how investors and analysts have reacted as of late. Cisco Systems reported fourth-quarter fiscal 2026 non-GAAP earnings of $1.22 per share, up 23% year over year and beating the Zacks Consensus Estimate by 4.27%. Broad networking demand and operating leverage supported the year-over-year growth.Revenues increased 18% year over year to $17.252 billion, topping the consensus mark by 2.36%. Product revenues increased 24% year over year.Product orders increased 35% year over year (up 25% excluding hyperscalers), while annualized recurring revenue (ARR) reached $32.1 billion, up 3% year over year, highlighting broad demand.Remaining performance obligations (RPO) totaled $46.7 billion, up 7% year over year, with product RPO rising 9%, while services RPO increased 6% year over year. Total software revenues increased 11% year over year to $6.183 billion, while subscription revenues represented 48% of total revenues. Networking revenues surged 28% year over year to $9.791 billion. The increase reflected triple-digit growth in AI infrastructure, double-digit growth in data center switching and continued growth in campus networking.Networking product orders jumped 40%, marking the eighth consecutive quarter of double-digit growth. Campus networking orders advanced 20%, while data center networking orders increased more than 35%. Wi-Fi 7 accounted for more than half of total wireless orders in the quarter.Hyperscaler AI infrastructure orders totaled $4 billion in the fourth quarter, taking fiscal 2026 orders to $9.3 billion, roughly 4.5 times the fiscal 2025 level. The fiscal-year mix was approximately 60% Silicon One-based systems and 40% optics.Cisco also secured three new hyperscaler design wins, covering P200-powered scale-across systems, G200-powered scale-out systems and an optical line system. AI infrastructure orders from neocloud, sovereign and enterprise customers exceeded $400 million in the quarter and totaled $1.3 billion for fiscal 2026. Security revenues increased 14% year over year to $2.226 billion. The entire security portfolio, including Splunk, recorded double-digit order growth. Firewall orders increased more than 30%, while more than 1,500 customers purchased newer offerings such as Secure Access, XDR, Hypershield and AI Defense during the quarter.Collaboration revenues advanced 12% to $1.167 billion, while Observability revenues rose 6% to $275 million. Services revenues were essentially flat at $3.793 billion. Non-GAAP gross margin was 66.3%, down 210 basis points (bps) year over year. Product gross margin fell 270 bps to 64.8%, primarily due to a higher hardware mix and memory costs, partly offset by productivity improvements and price increases. Services gross margin improved 80 bps to 71.6%.Non-GAAP operating expenses were $5.243 billion, up 5%, but declined to 30.4% of revenues from 34.1% a year earlier. Consequently, non-GAAP operating margin expanded to 35.9% from 34.3%, demonstrating operating leverage despite gross-margin pressure. Cash, cash equivalents and investments totaled $15.918 billion at the end of the fiscal fourth quarter compared with $16.6 billion at the end of the third quarter of fiscal 2026. Operating cash flow increased 27% year over year to $5.386 billion. CSCO returned $3.161 billion to shareholders through $1.502 billion of share repurchases and $1.659 billion of dividends. The current program has $8.1 billion under remaining authorization. For the first quarter of fiscal 2027, Cisco expects revenues between $18 billion and $18.2 billion. Non-GAAP earnings are projected at $1.32-$1.34 per share, with non-GAAP gross margin of 65-66% and operating margin of 35.5-36.5%.For fiscal 2027, Cisco projects revenues of $72.2-$73.4 billion and non-GAAP earnings of $5.05-$5.11 per share. Hyperscaler AI infrastructure revenues are expected to reach $7.5 billion, up from approximately $4 billion in fiscal 2026. In the past month, investors have witnessed a upward trend in estimates revision. The consensus estimate has shifted 19.25% due to these changes. Currently, Cisco has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Following the exact same course, the stock has a score of F on the value side, putting it in the bottom 20% quintile for this investment strategy. Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in. Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Cisco has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). 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Ciena surged 5% Friday to erase its post-earnings selloff, with Arista Networks also gaining 5% as money rotated into networking equipment as a group. IYW gained just 2% and SPY 1% while networking stocks surged 4-5%, confirming the move as a targeted sector rotation, not a broad tech rally. Ciena's 10.7% weekly gain makes it the group's swing name, where the post-earnings gap is nearly filled and further upside requires fresh buyers or a new catalyst. Just released. Our analysts combed the entire stock market and named the ten best stocks to buy right now, and Cisco Systems didn't make the cut. Enter your email to see the names that beat CSCO. The report is free. Enter your email and see if any of your stocks made the cut. Ciena (NYSE:CIEN) stock is up 5% to $351.38 in early Friday afternoon trading, extending a rebound that's now stretched across the full week. The move reverses the post-earnings selloff that followed Ciena's September 3 fiscal third quarter release. Today's advance has effectively closed the door on the initial negative reaction to the report and pushed the stock back through the level it held before the release. The bid extends well beyond Ciena today. Arista (NYSE:ANET) stock is up 5% to $197.84, and Cisco (NASDAQ:CSCO) stock is up 4% to $111.53. All three networking names are climbing by a multiple of the broader sector's move, and each is doing so on the same session without individual company news to explain it. The wider technology sector is trading much calmer than the networking group. The iShares U.S. Technology ETF (NYSEARCA:IYW) is up 1.5%, and the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is up 1%. Buyers are giving an extra boost to certain networking equipment stock rather than massively sweeping technology and large-cap indexes as a whole. Free Report, Just Released Why Didn't CSCO Make The Top 10 List? 24/7 Wall St has helped investors make money for over two decades, and our top analysts just finished ranking the definitive Top 10 Stocks To Buy Now. Not the ten biggest companies. Not the ten everyone is arguing about. The ten best stocks to buy right now. And CSCO didn't make the cut! The report is free, and you can see why we think each stock is a top investment today. Enter Your Email and See the Ten → No company announcement, contract award, guidance revision or regulatory decision was published by Ciena this session to explain the same-day move. The pattern across Ciena, Arista and Cisco reads like money rotating into the transport and switching layer as a group rather than a single-name catalyst. Each of the three covers a distinct slice of that stack, and today's session is treating them together in a way that hasn't been true every week this quarter. Ciena supplies the optical transport equipment that carries traffic between and inside data centers, Arista supplies the switching layer above it, and Cisco supplies networking equipment across both enterprise and service provider customers, the same infrastructure layer we mapped out in a free report on seven AI buildout suppliers that aren't chipmakers. The gap between the group's move and the sector fund's move makes today look like a real rotation, since Ciena, Arista and Cisco are each running well ahead of IYW and SPY. That framing puts the day's story on infrastructure demand rather than on any one company's balance sheet. What separates Ciena from Arista and Cisco right now is the week rather than the day. Ciena stock had the most ground to make up after its fiscal third quarter release, and Friday's climb has taken the stock to a 10.7% gain since last Friday. Arista stock and Cisco stock are running nearly as hard today without a comparable setback behind them. That difference shapes how the day reads for CIEN shareholders. The recovery has already carried Ciena stock past most of the ground it lost after the earnings release, and further upside from here would need buyers who haven't chased the group yet or a fresh catalyst that draws in longer-duration capital. Ciena's setup now reads as a decision point for anyone who sat out the initial bounce, since the easy part of the gap has already filled. For Arista and Cisco, the story is simpler. Both stocks are climbing on the group bid without an earnings hangover to work through, so today's move looks like fresh momentum rather than a recovery. The open question is whether the two can carry the group's leadership if Ciena stock's post-earnings gap finishes closing before Monday. The key tell into Friday's close is whether Ciena, Arista and Cisco shares all hold their gains into the bell. A firm close across the three would frame the narrow networking bid as a genuine rotation rather than an intraday burst. A softer finish for Arista or Cisco could pull Ciena stock's rebound back before next week begins. Traders can watch for whether the group's leadership carries into next week's action or fades once Ciena's earnings gap fully closes. Your networking-stock exposure could stay measured until that leadership holds through a second session at the same intensity, since two consecutive sessions of outsized moves would carry a different weight than a single afternoon. For now, Ciena stock remains the swing name in this group. The stock has both the freshest scar and the strongest week behind it, so its behavior over the next few sessions may set the tone for how the rotation is priced across Arista and Cisco. Arista stock and Cisco stock can follow the leadership, and their charts look cleaner, though CIEN is the one carrying the recovery story into next week and the one in which the risk-and-reward gap looks widest. If you have cash sitting in your account right now, give this two minutes. After more than two decades of helping investors beat the market, our top analysts at 24/7 Wall St. put together a definitive report on the Top 10 Stocks To Buy Today. And CSCO wasn't one of them. They combed the entire market. It's not 10 ideas, not 10 stocks everyone is talking about, it's what their research points to as the 10 best stocks to buy right now, and it's free. Read more here and >;elm:context_link;itc:0;sec:content-canvas" data-yga="{"yLinkElement":"context_link","yModuleName":"content-canvas","yLinkText":"see which stocks made the list -->"}" class="link ">see which stocks made the list -->> Contact [email protected] for any questions or corrections.

Saudi AI company Humain has begun preparations for its IPO, after its CEO Tareq Amin announced he was assembling a team of experts to help lay the groundwork for its listing. While he did not specify a date, Amin told the Future Investment Initiative conference last October that his aim was to list Humain in both Saudi Arabia and New York by 2029. Since its launch last year, Humain has secured deals and partnerships with xAI, Nvidia, Amazon Web Services, Adobe and Cisco, to name a few. Those achievements have been underpinned by finance from Saudi Arabia’s $900 billion Public Investment Fund which established Humain in May 2025 as the key engine for delivering its AI ambitions. The pursuit of an IPO marks a notable shift for a company whose growth so far has largely been funded by state capital. “This is a funding-discipline decision as much as a monetization one, at a point when PIF has been explicit that portfolio companies must reduce their draw on the sovereign,” Kurt Davis Jr, head of debt and capital advisory for the Middle East and Africa at professional services firm Alvarez & Marsal, told Fortune. “A listing gives permanent capital, audited disclosure, and a public credit story that lowers the cost of the debt behind the build-out. The difficulty is sequencing: a 2029 listing puts the company in front of public investors mid-construction, with most of its capex still ahead of it.” Last week, Bloomberg reported that G42, which is backed by UAE sovereign fund Mubadala, is also looking to raise outside capital. Executives have held preliminary talks with U.S. companies over a potential sale of a majority stake, with experts noting how the company is seeking to secure access to advanced chips beyond next year. The UAE was recently upgraded to an A:5 export control designation by the U.S., which allows G42 to buy advanced chips without a license until 2027, unless it changes its structure. “Beyond the question of capital, the story could be read through the lens of export controls,” said Mohammed Soliman, director of AI and compute infrastructure at McLarty Associates. “Both G42 and Humain want to stay within the American AI ecosystem. Outside capital and a possible American majority are how they keep this valuable access. “Humain is doing the same thing. Saudi Arabia does not have that A:5 designation yet and so bringing in outside investors is how the Humain team gets ready for a G42-style arrangement with Washington and how they also finance the build-out itself.” In addition to its planned IPO, Bloomberg reported last week that Humain is also looking to tap global and local investors to raise a $2.5 billion fund to finance a new wave of data center expansion across the kingdom. Meanwhile, Amin revealed that the $10 billion global AI venture capital fund that Humain first outlined last year could launch at an even larger scale by the end of 2026. Notably, he said the company will only invest in companies that commit to using Saudi data centers for part of their computing needs or establishing a workforce in the country. It also plans to invest in and support AI companies in Saudi Arabia through a new investment vehicle Humain Limitless. “We don’t do passive investments,” Amin said. Humain has also been vocal about actively pursuing a roadmap to build 1.9 gigawatts (GW) of AI computing capacity across Saudi Arabia by 2030 and over 6 GW by 2034. It told Bloomberg last week that its timeline remains on track despite the U.S.-Iran war. The kingdom’s data center capacity expanded sevenfold, from 68 megawatts (MW) in 2021 to 467 megawatts in the first quarter of 2026, according to official Saudi data, as investment in data centers and digital infrastructure surpassed SR56.2 billion ($14.98 billion). The Saudi data center market has considerable room for growth, according to a report published by Alvarez & Marsal last month. The kingdom has 12 watts of data center capacity per capita, compared to around 50 in the UAE and U.S. “This level of under penetration, in a market with this much capital behind it, is a build-out waiting to be financed,” it said. It highlights three key forces driving demand: A cloud-first public sector mandate underpinned by data sovereignty and personal data protection legislation; hyperscalers that increasingly lease rather than build in new markets; and AI workloads whose economics depend on the cost and availability of power, which is a comparative advantage the kingdom is building its pitch around. According to Alvarez & Marsal, Saudi’s AI and cloud expansion by 2030 will require up to $42 billion in project capital, including $32 billion of debt, if around half of its announced data centre capacity is delivered. However, securing long-term customers amid the current geopolitical environment could prove a challenge. In early March, two Amazon Web Services (AWS) data centers in the UAE were directly struck by drones, while one of its centers in Bahrain was damaged by a nearby drone strike. AWS was forced to transfer computing workloads to other regions and said that it expected the recovery to be “prolonged, given the nature of the physical damage involved.” The strikes were significant for marking the first time that military attacks had directly targeted and disrupted the data center operations of a major U.S. tech company. With billions of dollars still required to build out the kingdom’s AI and data centre infrastructure, attracting global investors will be crucial, particularly as geopolitical risks and export controls reshape the region’s technology landscape. For Humain, the challenge will be turning Saudi Arabia into a globally competitive AI ecosystem while maintaining access to the international technology and chip supply chains it depends on. This story was originally featured on Fortune.com

Cisco Systems has more than doubled investors' money over the past five years, yet current valuation checks point to a stock that still screens as cheap relative to its estimated intrinsic value. Recent AI infrastructure announcements and security headlines add fresh context to a story that is increasingly about how much of Cisco's cash flow potential is already in the price. The stock has returned 116.9% over the past five years, which puts extra focus on whether recent gains already reflect Cisco Systems' long term cash generation potential. Ongoing investment in AI infrastructure and sovereign networks can support expectations for future cash flows, while concerns over margins and cybersecurity threats to core routing products may weigh on how much of that is capitalised into the share price. The broader checks lean cheap, with Cisco scoring 6 out of 6 on value measures and a Discounted Cash Flow (DCF) estimate that sits about 28.7% above the current market level. The issue now is whether Cisco Systems' recent AI driven momentum and solid long term share performance justify the gap between the market price and the intrinsic value estimate, or point to more limited upside from here. Seize the momentum in Cisco Systems' AI buildout story by scanning a curated list of 55 AI infrastructure stocks. The Discounted Cash Flow (DCF) model here uses projected free cash flows to estimate what Cisco Systems could be worth today. Cisco generated about $13.1b of free cash flow over the latest twelve months in reporting currency, and the model assumes these cash flows keep growing rather than shrinking from that base. On those inputs, the DCF points to an estimated intrinsic value of about $153 per share. With the model implying a 28.7% discount to that figure, the DCF suggests the current market price is well below what Cisco Systems' cash flows might support. The recent share price reaction to concerns over margins and software growth, highlighted after the latest quarterly results, helps explain why the stock trades below the intrinsic value estimate despite continued AI infrastructure headlines. Taken together, the DCF workup indicates Cisco Systems stock currently appears undervalued relative to its projected cash flow profile. Our Discounted Cash Flow (DCF) analysis suggests Cisco Systems is undervalued by 28.7%. Track this in your watchlist or portfolio, or discover 47 more high quality undervalued stocks. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Cisco Systems. P/E is a useful yardstick for Cisco Systems because earnings remain a central metric investors watch for mature, cash generative tech companies. On this measure, Cisco currently trades on a P/E of about 32.5x, which is slightly below the Communications industry average of roughly 33.9x and also below the peer group average near 59.3x. That puts the stock on a valuation that is not especially low for the sector, but not stretched compared with many listed peers either. The fair P/E ratio from the model sits at around 33.8x, which is very close to where Cisco Systems is trading today. The small gap between the current multiple and this fair ratio suggests the market is already roughly aligning Cisco’s earnings power, AI infrastructure ambitions and margin questions with what the model implies. On balance, Cisco Systems stock looks priced about fairly on its P/E multiple. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives for Cisco Systems connect the earlier valuation checks with the core question of what has to happen next for the stock to be worth materially more or less than today’s price, and they live on the company’s Community page. Each one links its number to a clear view on how Cisco Systems' growth, margins and risks could develop, which you can return to as fresh results and news emerge. One of the top community narratives on Cisco Systems: roughly fairly valued Read one of the top narratives on Cisco Systems Do you think there's more to the story for Cisco Systems? Head over to our Community to see what others are saying! For Cisco Systems, the Discounted Cash Flow (DCF) work suggests meaningful intrinsic value support, while the P/E view points to a stock that is already roughly in line with sector earnings expectations. The broader checks lean toward Cisco screening as undervalued on cash flow, not obviously cheap on earnings. What really decides the outcome from here is whether Cisco converts its AI and security opportunities into durable cash generation without a sustained hit to margins, and whether investors keep treating that mix as worth only a standard multiple rather than re rating the stock higher. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include CSCO. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Hewlett Packard Enterprise (NYSE:HPE), an enterprise server, networking, storage, and AI infrastructure provider, closed at $54.44, up 5.03%. Investors focused on supply bottlenecks after a strong earnings beat and raised guidance, while watching AI server demand and the next earnings call. Trading volume reached 68.4M shares, coming in about 208% above its three-month average of 22.2M shares. Hewlett Packard Enterprise IPO'd in 2015 and has grown 466% since going public. The S&P 500 (SNPINDEX:^GSPC) rose 1.07% to 7,748, and the Nasdaq Composite (NASDAQINDEX:^IXIC) gained 1.40% to 26,584. Among enterprise hardware, networking, storage, and hybrid cloud infrastructure peers, Dell Technologies (NYSE:DELL) closed at $515.94, up 4.82%, while Cisco Systems (NASDAQ:CSCO) closed at $108.61, down 0.78%, showing mixed trading in AI infrastructure names. If investors are worried that the AI boom might be short-lived, HPE's Q2 results show it may not stall anytime soon. HPE soared past analysts' expectations, with sales and adjusted earnings per share rising 34% and 66%. The company also raised 2026 and 2027 sales growth guidance to between 34% and 37%, and 13% and 17%, respectively. HPE's networking unit stole the show, growing revenue by 75%, headlined by its data center networking unit up 112%, routing business soaring 270%, and security segment spiking 76%. Meanwhile, in the company's Cloud and AI unit, its server business rose 35% -- impressive growth for the company's largest business segment. Antonio Neri, president and CEO of HPE, explained, "AI is becoming a multi-year growth driver for HPE, and our differentiated portfolio positions us to capture that opportunity at scale." Trading at 14 times forward adjusted earnings, HPE could be a reasonably priced growth stock for investors who believe this growth reacceleration is here to stay for a few years or more. Before you buy stock in Hewlett Packard Enterprise, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hewlett Packard Enterprise wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $446,157!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,377,357!* Now, it’s worth noting Stock Advisor’s total average return is 983% — a market-crushing outperformance compared to 212% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of September 3, 2026. Josh Kohn-Lindquist has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cisco Systems and Hewlett Packard Enterprise. The Motley Fool has a disclosure policy. Stock Market Today, Sept. 3: HPE Jumps 5%, Raises Fiscal Outlook on Record AI Server Demand was originally published by The Motley Fool

Ciena dropped 10% on in-line Q4 guidance despite a record quarter beat, while Arista gained 3% on continued AI networking momentum. Cisco held nearly flat and IYW traded higher, confirming Ciena's slide is a company-specific valuation reset, not a sector-wide unwind. Two customers drove 42% of Ciena's quarterly revenue, and its elevated valuation means the December Q4 report is the next real inflection point. Just released. Our analysts combed the entire stock market and named the ten best stocks to buy right now. The report is free. Enter your email and see if any of your stocks made the cut. Ciena Corporation's (NYSE:CIEN) fiscal third-quarter beat wasn't enough to save its stock this morning. An in-line fourth-quarter revenue outlook overshadowed record results and sparked a sharp de-rating in a name that had rallied hard on the AI networking build. Interestingly, Ciena's peer-group stocks are holding firm, which makes the divergence the story of the session. Ciena stock is down 10% to $320.38, cutting into a year that had shares up 51% through the prior close. The pullback extends a rough stretch, with Ciena now down 18% over the past month. Today's move deepens a de-rating already in progress. Meanwhile, Arista Networks (NYSE:ANET) stock is up 3% to $191.65, isolating Ciena's specific guidance issue from the broader networking demand story. Meanwhile, Cisco Systems (NASDAQ:CSCO) stock is down 0.1% to $109.31. The SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which tracks the S&P 500 index, is up 1% to $773.17, and the iShares U.S. Technology ETF (NYSEARCA:IYW) is trading higher, so Ciena's slide isn't a broad-tape problem. Free Report, Just Released Did Any of Your Stocks Make the Top 10 List? It is an uncomfortable question, and there is now an answer to it. 24/7 Wall St has helped investors make money for over two decades, and our top analysts just finished ranking the definitive Top 10 Stocks To Buy Now. Not the ten biggest companies. Not the ten everyone is arguing about. The ten best stocks to buy right now. Open your account and look at what you own. Some of it you bought for a reason you could still defend today. Some of it you bought years ago for a reason you can no longer remember. The report is free. Put the ten next to what you own and find out which is which. Enter Your Email and See the Ten → Free from 24/7 Wall St. It lands in your inbox. Ciena reported adjusted earnings per share of $2.11 for the quarter ended August 1, 2026, against a $1.72 analyst consensus, with revenue of $1.67 billion versus a $1.63 billion estimate, up 37% from $1.22 billion a year earlier. Ciena's adjusted gross margin expanded to 46.4% from 41.9% in the prior-year period, a clean quality print behind the top-line acceleration. Ciena CEO Gary Smith stated, "Today's outstanding financial performance demonstrates Ciena's leadership in providing industry-leading, high-speed connectivity solutions as AI continues to drive compounding waves of network investment." The problem sits in the forward number. Ciena guided its fiscal fourth-quarter revenue to $1.75 billion plus or minus $50 million, a midpoint that only aligns with the $1.7 billion analyst consensus rather than clearing it. Ciena also raised its full fiscal year 2026 revenue guidance to $6.42 billion, up 35% year over year at the midpoint, but for a stock priced for acceleration, matching isn't beating, according to Ciena Corporation. Two Ciena customers together accounted for 41.7% of quarterly revenue, meaning the AI-driven demand is real but narrow, according to Ciena Corporation. Ciena CFO Marc Graff called the period a record quarter, yet that concentration weighs heavier on the Ciena multiple when the forward guide only matches expectations. That mix is what powered today's de-rating. Arista Networks stock was up 42% year to date (YTD) through the prior close and is extending gains today on continued AI fabric momentum. Arista posted Q2 FY2026 non-GAAP EPS of $1.02 on $3.04 billion in revenue in its August report, its first three-billion-dollar quarter. Management pointed to Ethernet-based AI networking as a durable share opportunity, with a full-year revenue outlook of approximately $12.6 billion. Cisco stock was up 44% year to date through the prior close after booking $4 billion in AI infrastructure orders in Q4 FY2026 and guiding fiscal 2027 AI infrastructure revenue to $7.5 billion. Cisco characterized the environment as a networking supercycle. Arista Networks and Cisco holding firm while Ciena resets is the cleanest evidence that this is a company-level issue, not a sector verdict. The table sets today's session move against the YTD anchor through the prior close for each covered name. Ciena's reset stands out against modest peer gains. Ciena's preliminary fiscal 2027 outlook calls for at least 30% revenue growth on a backlog of $8.5 billion exiting Q3 FY2026, so the December fourth-quarter report becomes the next real inflection point for the stock. Management framed the environment as a multi-year, supply-constrained investment cycle. That keeps the debate about pace and share rather than direction. Position sizing in Ciena shares should account for both the customer concentration and the tendency of supply-constrained networking names to trade on incremental order signals rather than trailing beats. A moderate approach makes sense while the guide-versus-consensus gap sorts out. Ciena's elevated valuation raises the bar for any forward number, and today's tape shows what happens when it isn't cleared. The broader read is that AI networking demand remains intact, with Arista Networks and Cisco both carrying rich YTD gains. Follow-through in those two names during the afternoon session may indicate whether today's Ciena move stays contained or spreads to peers. Ultimately, the IYW ETF trading higher today reinforces the containment case rather than a sector-wide unwind. If you have cash sitting in your account right now, give this two minutes. After more than two decades of helping investors beat the market, our top analysts at 24/7 Wall St. put together a definitive report on the Top 10 Stocks To Buy Today. They combed the entire market. It's not 10 ideas, not 10 stocks everyone is talking about, it's what their research point to as the 10 best stocks to buy right now, and it's free. Read more here and >;elm:context_link;itc:0;sec:content-canvas" data-yga="{"yLinkElement":"context_link","yModuleName":"content-canvas","yLinkText":"see which stocks made the cut -->"}" class="link ">see which stocks made the cut -->> Contact [email protected] for any questions or corrections.