Tech bellwether and erstwhile market darling, Cisco Systems, Inc.(NASDAQ:CSCO) has restarted its romance with Wall Street again. The Cisco stock, with a market value of $95 billion, has risen 15 percent in the last couple of weeks, while on Thursday it went up 3.2 percent to close at $17.70.
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Cisco, which provides a host of products and services for the telecommunications industry, has been helped by its restructuring exercise that has made it leaner and more agile in reacting to the current environment and more focussed.
The company has positioned itself to take advantage of the demand for networking gear arising from the spurt in Internet traffic as well as the mass shift to cloud computing.
There has been a renewed demand for telecommunications gear especially in the second half of the year and Cisco is in the right place at the right time.
Shares of Cisco have risen more than 10 percent in August so far, the best performing stock in the 30-scrip Dow Jones Industrial Average and could be on track to end the week with a gain of more than 7 percent.
The change in the pace of growth in the telecommunications sector has had its impact on other network gearing companies as well such as Juniper Networks, whose shares have shown a modest uptick in the last three months.
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Cisco has also seen upgrades from large brokerage houses such as that of Goldman Sachs and Piper Jaffray.
Piper Jaffray's analyst Troy Jensen has raised Cisco rating to overweight from neutral with a price target of $22, on expectations that it would exceed revenue estimates for its fiscal fourth quarter.
Goldman Sachs has set a price target of $24 for the shares.