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Cisco earnings: Duo acquisition is nice, but what have you done for us lately?


By Wallace Witkowski


Cisco (CSCO) is scheduled to report fiscal fourth-quarter earnings Wednesday after the closing bell, but those earnings aren’t what investors have focused on lately. Drawing the spotlight away was Cisco’s recent announcement that it is acquiring Duo Security for $2.35 billion, a move that drew accolades from many analysts.


Of the 27 analysts surveyed by FactSet, Cisco on average is expected to post adjusted earnings of 69 cents a share. The company forecast earnings of 68 cents to 70 cents a share.


Wall Street expects revenue of $12.77 billion from Cisco, according to 25 analysts polled by FactSet. That’s up slightly from the $12.70 billion forecast at the beginning of the quarter. Cisco predicted revenue of $12.62 billion to $12.86 billion. Estimize expects revenue of $12.79 billion.


Cisco shares fell after its previous earnings report, as services revenue came in light, and have yet to recover.


Of the 29 analysts who cover Cisco, 21 have buy or overweight ratings, eight have hold ratings and no analysts have sell or underweight ratings, with an average price target of $49.26, or nearly 13% above Monday’s closing price.




Walmart expected to report 12.9% growth in second quarter earnings


By Kim Souza


Wall Street is bullish on Walmart and expects double-digit earnings growth of 12.9% when the retail giant reports its fiscal second quarter results on Thursday (Aug. 16) ahead of the market opening.


The consensus of 26 analysts peg net income at roughly $3.6 billion, or $1.22 per share. That compares to $3.269 billion or $1.08 per share in the year-ago quarter ending July 31. Revenue growth of 2.2% is expected with total sales of $126 billion for the three months ending July 31.


Ben Bienvenue, an analyst with Little Rock-based Stephens Inc, believes solid results will push the stock price higher as “a broadly improving consumer backdrop coupled with continued improvements in-stores should sustain recent comp sales momentum in the U.S. market.”


Not all the analysts covering Walmart are as optimistic as Bienvenue. Credit Suisse analysts said they are concerned about earnings growth overall despite some positive trends through the quarter.


J.P Morgan analysts are also sitting on the fence with a neutral rating of Walmart shares and a price target of $87.



Twitter shares rise after short seller predicts big rally for the stock


By Tae Kim


  • Citron Research’s Andrew Left says Twitter shares will go higher due to the company’s initiatives to deliver “personalized content.”
  • The investor compared Twitter’s future potential to China-based Toutiao in a report on his website.



Amazon’s advertising profits will surpass its cloud computing income by 2021: Piper Jaffray


By Tae Kim


Amazon’s stunning growth in the internet advertising market will boost the company’s shares, according to Piper Jaffray.


“Investors should be focused on Amazon advertising now; this is a major driver to results and valuation today and continuing in the coming quarters & years,” analyst Michael Olson says.


Olson reiterated his $2,100 price target for Amazon shares, representing 11 percent upside to Friday’s close.


The analyst estimates Amazon’s ad business operating income will grow to $16 billion in 2021 versus $15 billion for Amazon Web Services that year.



AUD/USD Review: Hangs near 20-month lows, remains vulnerable to slide further


By Haresh Menghani


The AUD/USD pair struggled to register any meaningful recovery and remains within striking distance of 20-month lows, set in the previous session.


Chinese macro data released this Tuesday showed July retail sales growth stood at 8.8% y/y as compared to 9.0% expected and industrial output grew by 6.0% y/y as against 6.3% anticipated.


Adding to the disappointment, China’s fixed asset investment in the first seven months of the year slowed to a record low, highlighting faltering business confidence and eventually weighed on the China-proxy Australian Dollar.


However, a modest US Dollar profit-taking, despite a goodish follow-through pickup in the US Treasury bond yields, might help limit deeper losses, albeit the positive effect was largely negated by weaker copper prices, which tend to undermine demand for the commodity-linked Australian Dollar.



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