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Here's How Much Investing $100 In Cisco Stock Back In 2010 Would Be Worth Today

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Here's How Much Investing $100 In Cisco Stock Back In 2010 Would Be Worth Today

Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks did much better than others along the way.

Cisco’s Difficult Decade

One stock that had plenty of highs and lows over the past decade is networking hardware and software-as-a-service giant Cisco Systems, Inc. (NASDAQ: CSCO).

The rise of smartphones and general connectivity was good news for Cisco throughout the past year. Unfortunately Cisco’s router and switch hardware business has been pressured by the next generation of networking software, which in many cases is a lower-cost alternative to Cisco hardware.

In many ways, the past decade for Cisco has been defined by maximizing profits from its dominant legacy position in the router and switches markets, cutting costs to offset competitive pressures, and transitioning its business model to a more reliable recurring SaaS model. While revenue growth has slowed, Cisco has committed to returning at least 50% of earnings to shareholders via aggressive buybacks and a 2.9% dividend. In 2011, Cisco started off the decade by cutting about 3,000 employees and reducing its annual expenses by $1 billion. Two years later, Cisco announced another 4,000 job cuts.

Cisco shares started the 2010s trading at around $25. By mid-2010, the stock had reached $17.74 before taking a sharp turn lower. Cisco shares dropped as low as $13.30 in mid-2011, their lowest level of the decade.

Since that bottom, Cisco has marched steadily higher, making new highs in late 2014 and reaching $30 shortly thereafter.

2020 And Beyond

Cisco reached its decade high of $58.26 in the summer of 2019 before pulling back on trade war concerns.

Cisco has yet to come close to returning to its all-time dot-com bubble high of $80.06, but the popular tech stock was a solid overall performer over the past decade. In fact, $100 worth of Cisco stock in 2010 would be worth $261 today, assuming reinvested dividends.

Looking ahead, analysts expect Cisco to pick up steam in 2020. The average price target among the 21 analysts covering the stock is $53, suggesting 9.8% upside from current levels.

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Photo by Paul Frenzel on Unsplash

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