Cisco Systems (CSCO) Expands AI Security Ties, Is The Stock Still Undervalued?

Cisco Systems (CSCO) has pushed deeper into AI and security with new Splunk features, an expanded NVIDIA partnership for on-premises AI, and a multi-year joint product effort with AWS focused on AI-driven cyber risks.

Recent AI and security headlines around Cisco Systems have arrived after a strong run, with the share price up 44.02% year to date and supported by a 63.87% 1-year total shareholder return. This comes even as the 90-day share price return declined 8.39%, hinting that enthusiasm has cooled in the short term while longer-term holders remain well in the green.

Look beyond Cisco Systems and ride the AI infrastructure and security wave with a hand picked set of 89 AI infrastructure stocks in similar high-intensity buildout phases.

Bulls point to Cisco Systems’ AI push, security breadth, and cash generation, while bears focus on slower recent growth and margins under pressure. Which side does the current valuation actually support?

Most Popular Narrative: 90% Undervalued

The most followed Cisco Systems narrative puts fair value around $110.56 per share, only slightly above the last close at $109.51. That gap is small, yet the narrative itself leans heavily on how Cisco fits into the AI buildout.

Cisco is not a pure AI growth play. That is precisely its appeal. It offers asymmetric positioning, exposure to one of the strongest secular trends (AI), combined with defensive financial characteristics.

See why 35 investors see Cisco Systems as 1% undervalued.

Result: Fair Value of $110.56 (UNDERVALUED)

Still, the Cisco Systems story can weaken if AI orders soften from key hyperscalers or if restructuring missteps undercut the security and software transition.

Find out about the key risks to this Cisco Systems narrative.

Next Steps

Sentiment around Cisco Systems is mixed on price, but the rewards side of the ledger has investors paying attention, so move fast and test the numbers yourself. To see what those potential upsides look like in one place, review the 6 key rewards.

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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.

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