Cisco, Axon and Peers Move Ahead of Key Earnings
Key Points
- Cisco shares slip even as analysts highlight AI-driven growth and downplay an Axonius takeover
- Axon Enterprise falls despite strong recent gains and robust revenue growth forecasts
- Multiple large caps across tech, healthcare and real estate trade at valuation premiums to their industries
- Upcoming earnings reports are set to test optimistic consensus estimates across several sectors
Cisco underperforms as Axonius deal seen unlikely
Cisco Systems closed at $73.96, down 1.02% on a day when the S&P 500 edged up 0.01%. The stock has fallen 6.89% over the past month, lagging both the Computer and Technology sector and the broader index. Despite the pullback, Cisco is expected to post year-over-year growth of 8.51% in earnings per share to $1.02 and an 8.06% rise in revenue to $15.12 billion in its next quarterly report. For the full year, consensus forecasts call for EPS of $4.10 and revenue of $60.59 billion, up 7.61% and 6.95%, respectively. Cisco trades at a forward P/E of 18.21, above its industry’s 17.19, and carries a PEG ratio of 2.27 versus an industry average of 1.56. The stock holds a Zacks Rank of #3 (Hold), with consensus EPS estimates unchanged over the past month. Separately, TD Cowen analyst Shaul Eyal said on January 5 that channel checks and industry conversations suggest a Cisco acquisition of cybersecurity firm Axonius “is not imminent and is currently not in our cards.” The analyst noted that other security names such as SentinelOne, Varonis and Tenable could attract strategic and financial interest, helped by lower interest rates and efforts to broaden security capabilities. Cisco’s shares rose more than 28% in 2025, and first‑quarter fiscal 2026 revenue increased 8% year over year, while net income grew 5%. The company reported AI‑related infrastructure orders of $1.3 billion, describing this as a significant acceleration in growth. According to that report, Cisco’s positioning as an Internet infrastructure provider with integrated networking, security, collaboration, applications and cloud products underpins its case as a dividend stock, with investor focus currently on the durability of AI infrastructure sales.
Axon insider selling and rich valuation accompany stock pullback
Axon Enterprise shares closed at $612.98, down 1.28% and underperforming the flat S&P 500. Even after the decline, the maker of stun guns and body cameras has gained 9.24% over the past month, outpacing both the Aerospace sector and the broader market. The company is projected to report quarterly EPS of $1.65, which would represent a 20.67% decline from the prior‑year period, alongside revenue of $753.65 million, up 31.04% year over year. For the full fiscal year, consensus estimates call for EPS of $6.35, up 6.9%, and revenue of $2.74 billion, unchanged versus the prior year. Over the last 30 days, the consensus EPS forecast has been stable, and Axon holds a Zacks Rank of #3 (Hold). The stock trades at a forward P/E of 80.31, more than double the Aerospace – Defense Equipment industry’s 35.81, and has a PEG ratio of 3.23 versus an industry average of 2.17. Separately, Axon’s CEO Patrick Smith sold 10,000 shares on January 7, 2026, leaving him with 3,100,997 shares. This transaction continues a broader insider trend over the past year, with 39 insider sells and one insider buy reported. Another valuation measure cited Axon’s share price at $619.01 as modestly overvalued relative to a GF Value estimate of $495.82, and indicated a price‑earnings ratio of 193.98, well above the industry median.
Other large caps show mixed price action and premium multiples
Beyond Cisco and Axon, several other large companies reported notable moves and expectations. Teradyne fell 2.77% to $216.31 but remains up 9.05% over the past month, beating its sector and the S&P 500. The test‑equipment maker is forecast to grow quarterly EPS 43.16% to $1.36 and revenue 28.68% to $968.79 million, with full‑year EPS expected to rise 9.01%. Teradyne trades at a forward P/E of 43.81 versus an industry average of 23.78 and has a PEG ratio of 1.61, slightly below its industry’s 1.68, and carries a Zacks Rank of #3 (Hold). Analog Devices advanced 2.14% to $299.16 and is up 4.02% over the month. It is projected to deliver quarterly EPS growth of 39.88% and revenue growth of 28.21%, and full‑year EPS and revenue increases of 25.67% and 16.36%, respectively. The stock holds a Zacks Rank of #1 (Strong Buy), with its consensus EPS estimate up 0.52% in the past month. Analog Devices trades at a forward P/E of 29.92, below its industry’s 40.79, and has a PEG ratio of 1.62 versus an industry average of 2.29. Vertex Pharmaceuticals declined 2.99% to $469.68 but has gained 8.89% over the last month, outpacing its sector and the S&P 500. The drugmaker is expected to post quarterly EPS of $5.05, up 26.88%, on revenue of $3.16 billion, up 8.65%. Full‑year consensus calls for EPS of $18.40 and revenue of $11.98 billion, implying year‑over‑year changes of 4,280.95% and 0%, respectively. Vertex carries a Zacks Rank of #3 (Hold), with its consensus EPS estimate down 0.02% over the past month, and trades at a forward P/E of 24.25 versus an industry average of 22.11.
Realty Income and other income names balance yield and valuation
Realty Income Corp. rose 1.64% to $58.29, outperforming the S&P 500. The REIT’s shares are up 1.2% over the past month, trailing the Finance sector but ahead of the broader index. Analysts expect quarterly EPS of $1.08, up 2.86% year over year, on revenue of $1.46 billion, up 9.14%. Full‑year EPS is projected at $4.26, up 1.67%, with revenue of $5.72 billion, flat versus the prior year. Realty Income holds a Zacks Rank of #3 (Hold), with its consensus EPS estimate down 0.25% in the past month. The stock trades at a forward P/E of 13, slightly below its industry’s 13.55, and has a PEG ratio of 3.48 versus an industry average of 2.62. A separate valuation analysis placed Realty Income’s share price at $57.35 and suggested a narrative fair value of $61.26, implying the stock was 6.4% undervalued on a dividend‑focused basis. That assessment highlighted expectations for decelerating dividend growth and contrasted the dividend‑based fair value with an earnings multiple view. On that measure, Realty Income’s P/E of 54.8x was above peers at 31.7x, the US Retail REITs industry at 27.4x, and a cited fair ratio of 34.9x, indicating a premium valuation on earnings. Other income‑oriented names also showed mixed signals. VICI Properties gained 1.09% to $27.86 but is down 0.72% over the month. It is expected to grow quarterly EPS 5.26% and revenue 4.08%, with full‑year EPS and revenue projected to rise 4.87% and remain flat, respectively. VICI trades at a forward P/E of 11.27, slightly above its industry’s 11.19, and has a PEG ratio of 2.74 versus 2.49 for its peers, and holds a Zacks Rank of #3 (Hold).
Key Takeaways
- Cisco’s near-term share weakness contrasts with solid growth forecasts and rising AI infrastructure orders, while an Axonius acquisition is viewed as unlikely by TD Cowen.
- Axon combines strong recent price performance and rapid revenue growth expectations with heavy insider selling and valuation metrics well above sector norms.
- Across technology hardware and semiconductors, companies such as Teradyne and Analog Devices are priced at premiums or discounts to their industries despite broadly strong earnings growth outlooks.
- Income-focused REITs like Realty Income and VICI show modest earnings and revenue growth, with valuations that can look attractive on dividend metrics but elevated on earnings multiples.
References
- 1. https://www.sharewise.com/de/news_articles/Axon_Enterprise_AXON_Stock_Sinks_As_Market_Gains_What_You_Should_Know_Zacks_20260109_0000
- 2. https://www.gurufocus.com/news/4103523/axon-enterprise-inc-axon-ceo-patrick-smith-sells-10000-shares
- 3. https://www.sharewise.com/de/news_articles/Realty_Income_Corp_O_Rises_Higher_Than_Market_Key_Facts_Zacks_20260108_2345
- 4. https://www.sharewise.com/de/news_articles/Cisco_Systems_CSCO_Stock_Dips_While_Market_Gains_Key_Facts_Zacks_20260108_2345
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