BofA Boosts Cisco (CSCO) Price Target, Citing AI Networking and Campus Refresh Strength

Core Insights - Cisco Systems, Inc. is gaining attention as an AI stock, with BofA Securities raising its price target to $95 from $85 while maintaining a "Buy" rating due to strong orders for AI networking and campus refresh demand [1][2] - The company has set a $3 billion AI revenue target for FY26, significantly up from $1 billion recorded in FY25, indicating robust growth potential in the AI sector [2][3] - The networking cycle is expected to continue benefiting Cisco, particularly as AI expands into enterprise environments, with a notable $10 billion of old campus products reaching end-of-service in FY26 [2][3] Financial Performance - Cisco's revenue growth guidance for 2026 has been increased to 7%, compared to the Street's estimate of 5.3%, driven by AI and campus strength [3] - Despite the positive outlook, the security segment has underperformed, showing a 2% year-over-year decline, even with new platform launches and firewall refreshes [3] - The stock is currently trading at a forward EV/FCF multiple of 17x, with updated estimates reflecting a price target increase based on 21x 2027E EV/FCF, up from 19x previously [3]