Goldman Warns On Cisco: 'Running Out Of Levers'

'Exhausted' Levers

Cisco's three main levers are "largely exhausted" in Jankowski's eyes:

• Server share gain are leveling off
• Expanding operating margins are at a 10-year peak
• Buybacks are poised to slow after the 24 percent increase in the dividend this year

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The analyst's estimates remain the same. In the near- to intermediate-term Jankowski sees elevated risks. "We see heightened competitive pressure from a more focused HPE following its acquisition of Aruba last year," she said. As share gains in the servers segment weaken, they will not to be able to offset losses in networking anymore. Finally, execution risks have increased as the company has changed leadership "in virtually every business segment and C-level position," Jankowski stated.