Morgan Stanley sees stabilization in Cisco Systems' (CSCO) North American enterprise market but maintains its neutral rating.
Analyst Chris Stix says recent data indicate that, while the North American enterprise networking market continues to be weak vs. last year, it appears to have stabilized, which is good news for Cisco.
Also, Stix thinks the Fed's third rate cut finally is having a positive impact on investor confidence, and should positively affect enterprise spending on IT infrastructure. While the improvement in the North American enterprise business is positive, it's only a third of the company's business: Cisco's service provider networking equipment business and international enterprise business (remaining 66%) still is weak. Stix maintains his neutral rating.