UPDATE: Wunderlich Securities Downgrades Cisco Systems on Lowered Expectations

In a report published Tuesday, Wunderlich Securities analyst Matthew S. Robison downgraded the rating on Cisco Systems (NASDAQ: CSCO) from Buy to Hold, and lowered the price target from $25.00 to $24.00.

In the report, Wunderlich Securities noted, “We see more opportunity in recent valuation compression among small cap/growth stocks in networking than the implied haven of the Cisco (CSCO) market cap, but our downgrade is more than a trading call. We came away from industry interviews in recent weeks with the view that the market has less interest in the Cisco product suite than in past transitions.

"We see the range of alternatives for network automation/software defined networking (SDN), network function virtualization (NFV), and cloud services as dilutive to the Cisco installed base upgrade opportunity. We have trimmed our forecast moderately and with the adjustment we have reduced our 12-month target to $24 from $25. Because we view Cisco shares to be close to fully valued, we are downgrading to Hold from Buy.”

Cisco Systems closed on Monday at $22.85.