Cisco (NASDAQ: CSCO) Stock Analysis: Morgan Stanley Sets Bullish Price Target Amid AI Growth

• Bullish Analyst Outlook: Morgan Stanley set a price target of $135.00 for Cisco (NASDAQ: CSCO), indicating a potential upside of 8.98% from its trading price of $123.88.
• Strong Q4 Performance Driven by AI: Cisco reported record Q4 revenue of $17.30 billion, an 18% year-over-year increase, fueled by an "AI super cycle" and 35% growth in product orders.
• Valuation Concerns Despite Growth: Despite strong performance, Cisco faces concerns regarding squeezed gross margins and a GuruFocus valuation suggesting it may be overvalued with a GF Value of $69.43.

On August 13, 2026, an analyst from Morgan Stanley set a price target for Cisco (NASDAQ: CSCO) at $135.00. Cisco is a global technology company that designs and sells a broad range of technologies that power the Internet. It provides networking, security, collaboration, and cloud solutions to businesses of all sizes.

At the time of the report, Cisco was trading at $123.88, which suggests a potential upside of about 8.98% if the target is met. This positive outlook comes as the company navigates a dynamic market, with its stock trading near its 52-week high of $130.37 and showing a daily gain of 2.86%.

This optimism is supported by the company's recent performance. As highlighted by GuruFocus, Cisco reported a record Q4 revenue of $17.30 billion, an 18% year-over-year increase. This growth is attributed to an "AI super cycle," with total product orders rising 35% year-over-year, including triple-digit growth from large cloud service providers.

Despite these record results, some concerns exist. As highlighted by MarketWatch, analysts point to squeezed gross margins as a potential issue. Gross margin represents the profit made on products before other expenses. A lower margin can indicate reduced profitability on sales, even if overall revenue is high.

Furthermore, a valuation from GuruFocus suggests Cisco may be overvalued, with a calculated GF Value of $69.43 compared to its current price. The company also returned $12.70 billion to its shareholders in fiscal 2026, which is 99% of its free cash flow, a measure of cash generated after capital expenditures.