Seeking Alpha

Cisco hikes dividend, buys back $4B worth of shares

  • Cisco (CSCO) uses its FQ2 report to announce a $0.02/share increase in its quarterly dividend to $0.19/share. Shares now sport a 3.3% yield.
  • Cisco, which added $15B to its buyback three months ago, also says it bought back $4B worth of shares (over 3% of outstanding shares) in FQ2 at an average price of $21.73. $2B was spent on buybacks in FQ1, and $1.2B in FQ4.
  • Product revenue (drives future services revenue) fell 11% Y/Y to $8.4B Services revenue rose 3% to $2.7B and contributed to the revenue beat.
  • Gross margin was 61.3%, -100 bps but in-line with guidance of 61%-62%. Job cuts led opex to fall 6% Y/Y to $4.28B.
  • CSCO -0.4% AH. CC at 4:30PM ET, guidance should be provided.
  • FQ2 results, PR
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Comments (6)
  • Mark Krieger
    , contributor
    Comments (4577) | Send Message
     
    buy the dip guys, you will be glad you did
    12 Feb 2014, 06:12 PM Reply Like
  • MisterJ
    , contributor
    Comments (893) | Send Message
     
    Indeed. I'm with ya there.
    12 Feb 2014, 06:19 PM Reply Like
  • Daniel Radakovich
    , contributor
    Comments (851) | Send Message
     
    Cisco had 7.4B shares outstanding in 2000, they still have around 5.3B outstanding, maybe a little less today depending when the shares were bought back.

     

    Yet, here is the press release by Cisco that states: "As of January 25, 2014, Cisco had repurchased and retired 4.1 billion shares of Cisco common stock at an average price of $20.53 per share for an aggregate purchase price of approximately $84.9 billion since the inception of the stock repurchase program."

     

    That other 2 Billion shares were due to stock options I presume? Am I missing something?
    12 Feb 2014, 08:10 PM Reply Like
  • 7612841
    , contributor
    Comments (67) | Send Message
     
    I don't know how man shares they used in their pension plan, i hope it wasn't anything close to 2 billion shares, but sometimes they also use their treasury shares to purchase other companies.
    13 Feb 2014, 03:05 PM Reply Like
  • smurf
    , contributor
    Comments (4710) | Send Message
     
    Already in at 20 and change. I'm happy.
    12 Feb 2014, 11:55 PM Reply Like
  • Tradevestor
    , contributor
    Comments (4130) | Send Message
     
    A look at Cisco after earnings and new dividend.. http://seekingalpha.co...
    13 Feb 2014, 09:10 AM Reply Like
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