Investment firm UBS expects Cisco to report "strong" results for its fiscal 2010 first quarter on Nov. 4. UBS cites improved spending in US enterprise, strong federal government sales, and a "modestly improving" carrier capital spending environment.
UBS has raised its estimates for Cisco's quarter to $8.75 billion, or 3% growth, vs.
Street expectations of $8.74 billion, or 2% growth. Earnings may also improve and exceed intial expectations "with improving demand and execution," the firm notes in a preview bulletin this week.
UBS also expects Cisco's M&A activity, which has been aggressive of late with multibillion dollar offers for Tandberg and Starent Networks, to continue:
Cisco's 2009 M&A strategy may continue to unfold-we will not be surprised if Cisco makes another acquisition. As for the Tandberg deal, we do not see Cisco raising its price (bad precedent).
The jury's still out on whether a broad market recovery will allow Cisco to recapture market share lost earlier this year, UBS notes.
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