The Tech sector will send one of their heavyweights into the earnings ring today as Cisco Systems (CSCO, $22.92, up $0.06) reports their numbers after the close
The company is expected to report earnings of $0.48 a share on revenue of $11.38 billion, on average. There are 35 suit-and-ties that cover the stock with a low estimate for a profit of $0.47 a share. The high estimate is at $0.54 a share.
Cisco Systems is “king of beating by a penny” but lately the company has been beating by a couple of pennies every other quarter. Given the current trend of a 1,2,1,2 beat in prior quarters, it will be interesting to see what they report.
My guess is a penny but they will need to impress Wall Street with a beat-and-raise as other optical suppliers have shown weakness after reporting their results.
Cisco is not a high-beta stock but shares could move 5%-8% depending on the news. The chart work shows risk to $22 or a pop to $24 could be in the works.
There is an opportunity to possibly make a nice-double-digit return using a strangle option trade but once again, with May options expiring this Friday, I don’t like the risk/ reward setup.
Heading into the second half of trading, the Dow is down 62 points to 16,653 while the S&P 500 is lower by 4 points to 1,893. The Nasdaq is getting hit for 11 points to 4,119 and the Russell 2000 is tanking 9 points to 1,112.
Subscribers, check the Members Area for a New Trade and current updates.