CS First Boston cut estimates on Cisco Systems (CSCO ).
Analyst Lissa Bogarty says Q4 revenues were a bit better than expected, and Cisco's commentary about business momentum also met her expectations. However, she says gross margins were disappointing, and she cut the $0.33 calendar 2002 EPS estimate to $0.29, and trimmed the $0.54 calendar 2003 estimate to $0.49. Bogarty sees $0.16 EPS for fiscal 2002 (July) and $0.39 EPS in fiscal 2003.
Bogarty says the company's strong balance sheet, re-energized management focus, strategic market position and favorable product mix all suggest the company will outperform in a market that is likely to remain tough. She notes shares are not cheap at 67 times her new calendar 2002 estimate and 40 times her new calendar 2003 estimate, but she still thinks Cisco can trade at at multiple of 50 based on her 2003 EPS estimates. Bogarty maintains her buy rating with a $25 target.