Cisco Systems Financial Statements and Financial Ratios Analyzed from 2015 to 2019
Thanks for visiting my Cisco Systems Financial Report page. On this page, you will be able to find preliminary information about Cisco current financial performance as well as some historical track records and trends.
For a more detailed examination of Cisco financial performance, please check out the "Financial Report". In this report, written by myself, Paul Borosky, MBA., Doctoral Candidate, and published author, you will find:
- Summarized income statement for the last 5 years.
- Summarized balance sheet for the last 5 years.
- Summary analysis by myself of the important income statement, balance sheet, and financial ratio trends and other happenings.
- Five years’ worth of over twenty common financial ratios presented with formulas, calculations, and analysis tips for each ratio.
- Line by line description, explanation, and analysis tip for most financial statement line items and financial ratios.
- Professional financial analysis tips are provided in each section to help YOU conduct your OWN financial analysis!
- Each section includes an “in other words” segment. This is where I use plain English to explain concepts.
Enjoy the preliminary information and for a more detailed analysis, buy the financial report!
- Free Bonus Downloads: Annual Statements for the Last Five Years (10k reports)!
Sample Financial Report
Cisco Systems: Brief Summary
Cisco Systems (CSCO) headquarters is located in San Jose, California. The organization competes in the technology sector, specifically the communication equipment industry. At present, Cisco employs approximately 76,000 employees. Their main revenue generators would be the designing, manufacturing, and selling of Internet-based networking and other communication equipment.
From a financial perspective, Cisco Systems stock price ranges between $32.40 to $58.26 in the last 52 weeks. The company does pay out dividends, approximately 3.16% yield. Their market capitalization is $192.6 billion. Finally, the organization beta is .96, which indicates that the company’s risk as compared to the overall market is slightly lower.
Cisco Systems Financial Report Sources
“Cisco 2019 Company Analysis… For Beginners: Financial Statements and Financial Ratios: Defined, Discussed, and Analyzed for 5 Years” was written by, Paul Borosky, MBA. and owner of Quality Business Plan. In this report, I used Cisco 2018 10k, 2017 10k annual report, 2016 10k annual report, 2015 10k annual report, and 2019 10k annual report as the basis for information gathering.
Section 1: Cisco Income Statement Analyzed 2015 to 2019
In this section, I walk through a broad definition as to what an income statement is and why it is important. From this, I then discuss and define income statement line items, such as revenues, gross profits, etc. in detail. After each line item is defined and discussed, I finally offer a summary analysis of Cisco important income statement line item trends from 2015 to 2019, in most cases.
Cisco Systems Revenue Growth.
In 2015, Cisco Systems revenues ended the year at $49.1 billion. The company would slightly increase its revenues to $49.2 billion in 2016 only to fall in 2017 to $48 billion. Fortunately, though the company did increase its revenues for the last two years ending 2019 at approximately $51.9 billion. The anemic growth in the last five years should be worrisome for investors. A main reason why is that the company competes in the technology sector. To adequately compete, this requires continuous innovation, which it seems like Cisco is lacking. If the trend in 2019 continues, then it may indicate that the firm has improved its competitive nature. However, a fall in revenue in 2020 should indicate to investors that the organization has some cultural dysfunction that needs a deep cleaning.
Cisco Systems 2019 Income Statement
|R & D||6,577||6,332||6,059||6,296||6,207|
Section 2: Cisco Balance Sheet Analyzed from 2015 to 2019
For Cisco Systems balance sheet, I again go through each important line item from the balance sheet. In reviewing each line item, I will define their balance sheet line item, such as cash, property, plant and equipment, and liabilities between 2015 to 2019. Next, I then offer a summary analysis of their important balance sheet line items.
Cisco Systems Short-term Investments
Cisco Systems ended 2015 with approximately $53.5 billion in short-term investments. Their short-term investments would grow through 2017 ending the year with approximately 58.7 billion in short-term investments. However, in the next two years, the organization's short-term investments would continuously fall ending 2019 with $21.6 billion in short-term investments. As a concern, a significant fall in short-term investments may indicate that the company is burning cash and needs to supplement its operations with short-term investments. However, the organization had increased its revenue substantially from 2018 to 2019. If this revenue increases again in 2019, then this funding may have been utilized for research and development, which would be a good thing. From an investor perspective, they should be looking real hard at 2020s financial statements for a better understanding of the companies trends in this area as well as revenues.
Cisco Systems 2019 Summary Balance Sheet
|Short Term Investment||21,663||37,614||58,784||58,125||53,539|
|LT Debt - Current|
|Total Current Liabilities||31,712||27,035||27,583||24,911||23,623|
|Total Equity & Liability||97,793||108,784||129,818||121,652||113,481|
Section 3: Cisco Financial Ratios Analyzed from 2015 to 2019
For this section, I have chosen several different financial ratios to review for Cisco from 2015 to 2019. In reviewing each of their financial ratios, I first start with defining the financial ratio. Next, I supply the financial formula for calculating the specific ratio. Finally, I offer a brief analysis of their important Financial ratios.
Cisco Systems Current Ratio.
Cisco Systems ended 2015 with a current ratio of 3.23. The gold standard which indicates financial solvency for the next 12 months is 1.0. This indicates that the company had three times as much current assets as needed to ensure solvency. In my most humble of opinion, this indicates that the company’s executive team is mismanaging its current assets. A better strategy would be to either increase dividends to reduce their current asset position or utilize current assets in a more long-term manner like purchasing additional property, plant, equipment to help lay the foundation for future growth. Fortunately, in the next four years, the organization would take action to substantially reduce its current ratio position ending 2019 with the current ratio of 1.51.
Cisco Systems Total Asset Turnover.
Cisco Systems ended 2015 with a total asset turnover of .43. In the next two years, their total asset turnover would fall 2.37 in 2017. This indicates that the company is using its total assets in a less efficient manner to generate revenues year-over-year. In my opinion, this is a direct reflection as to lacks a daisy attitude by the executive team. Fortunately, the total asset turnover for Cisco would slightly improve over the next two years ended 2019 with .53. If this trend continues, this may indicate that the company has taken action to improve the usage of assets as a whole.
Cisco Systems Return on Assets.
In 2015, Cisco Systems ended the year with a return on asset ratio of 7.9%. In the next four years, their return on assets would fluctuate between .1% and 8.8%, ending 2019 with a return on assets of 11.88%. As an investor, when a company’s return on assets are over the board, this should throw up some serious red flags. Additional research needs to be done to determine why a significant fluctuation in this ratio has been done. Unfortunately, there is no real clear answer.
Cisco Systems Debt ratio.
Cisco Systems ended 2015 with the debt ratio of 18.9%. The company would increase its debt ratio to 20.1% in 2016. Fortunately, though in the next three years, the company would continuously reduce its debt ratio ending 2019 at 14.8%. Reducing their debt ratio also reduces the risk of bankruptcy and insolvency. From this perspective, kudos to Cisco’s executive team. However, this should also indicate to investors that Cisco is running out of ideas for investments. If they had innovative ideas, then the organization, from my opinion, would be tapping into debt to fund the future growth. There’s nothing better than making money on borrowed money. Unfortunately, this is not the case. A technology industry that is running out of ideas is worrisome.
Cisco Systems 2019 Liquidity Ratios
|Net Working Capital||12,195||10,440|
Cisco Systems 2019 Asset Utilization
|Total Asset Turnover||0.53||0.45|
|Fixed Asset Turnover||18.61||16.41|
|Days Sales Outstanding||38.61||41.09|
|Accounts Receivable Turnover||9.45||8.88|
|Working Capital Turnover||4.26||4.73|
|Average Days Inventory||26.24||35.99|
|Average Days Payable||39.07||37.12|
|Cash Conversion Cycle||25.79||39.96|
Cisco Systems 2019 Profitability Ratios
|Return on Assets||11.88%||0.10%|
|Return on Equity||34.62%||0.25%|
|Net Profit Margin||22.39%||0.22%|
|Gross Profit Margin||62.94%||62.04%|
|Operating Profit Margin||27.39%||24.95%|
|Basic Earning Power||14.54%||11.32%|
Cisco Systems 2019 Long-term Debt
|Times Interest Earned||16.55||13.05|