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Cisco Systems Inc

CSCOAbove value

Held by 8 superinvestors.

Price$107.39
Holders8
Total value$756.5M

SEC 10-K · fundamentals

Business quality

As of 2026-07-25
Revenue growth
+11.8%
Net margin
21.0%
ROE
26.4%
FCF margin
20.2%
Revenue $49.82B → $63.33B · 6y
What makes a business high quality

Valuation · value band

Above fair value

$33/ sh · growth-anchored intrinsic value
margin of safety
fair value
above fair value
$107
cheaperpricier

Zero-growth floor

$26

Central IV

$33

Optimistic top

$38

Cisco Systems Inc (CSCO): A conservative value band $26–$38 / sh (zero-growth floor to growth-capped optimistic top); central read about $33. Today’s price sits above that band (price $107 as of 2026-10-16).

The middle figure is the main read. The right end is the optimistic case under the same conservative caps — not an absolute ceiling.

  • Capex doubled in two years, so maintenance is hard to pin down — read the band conservatively.

Revenue growth 2% (lower of historical trend and fundamental cap, capped by moat) · moat 20 yr · discount 10.8% · Zero-growth downside $26

Price as of 2026-10-16 · yahoo · DGS10 5.1% @ 2026-10-15.

Method & numbers

Model cautions

  • Capex doubled within two years: maintenance is floored then capped at D&A (OE may look optimistic); Greenwald growth value is closed — growth credit stays in the owner-earnings DCF only.

A conservative intrinsic-value band (zero-growth floor to growth-capped DCF) plus a tangible asset floor — not investment advice, not a buy/sell signal, and not a price target.

Owner-earnings DCF $25.71 – $37.56 · Greenwald zero-growth $32.49 · zero-growth base $32.49 · reproduction $10.77

Moat Franchise (moat) · terminal value 17% of present value · owner-earnings yield 3% vs 10Y 5.1%.

Graham earnings-power value (normalized NOPAT)$25.66 – $32.23 / sh

Normalized NOPAT = average operating margin over the years shown × latest-year revenue × (1 − normalized tax); then + D&A − maintenance capex (write A). Unlevered (pre-interest, attributable to all capital). Capitalized at the 9–11% rate band (read as a WACC proxy). Enterprise → equity bridge applied: + cash − total debt.

Years: 2026, 2025, 2024, 2023, 2022

v1 simplifications: Maintenance capex (degraded) deducted in full cash (write A): EPV = (NOPAT + D&A − maintenance capex) / WACC; no tax shield on the capex term. Maintenance-capex methods diverge by 125% (> 50%); estimate is degraded. Capex doubled within two years (AI-hog rule): flagged; the spike is treated as growth, not maintenance — owner earnings carry extra uncertainty. Share-based compensation is left as a real expense (not added back).

Buffett owner-earnings value$26.58 – $32.49 / sh

Owner earnings = average net income + average D&A − maintenance capex (zero-growth floor; no ΔNWC). Levered (starts from net income, already after interest — an equity-holder stream). Capitalized at the 9–11% rate band (read as a cost-of-equity proxy). No enterprise→equity bridge: the capitalized result is already equity value (subtracting debt would double-count interest).

Years: 2026, 2025, 2024, 2023, 2022

v1 simplifications: Owner earnings = net income + D&A − maintenance capex (degraded); the working-capital change is excluded (maintenance ΔNWC ≈ 0; growth ΔNWC is carried in growth value, not double-counted). Maintenance-capex methods diverge by 125% (> 50%); estimate is degraded. Capex doubled within two years (AI-hog rule): flagged; the spike is treated as growth, not maintenance — owner earnings carry extra uncertainty. One-time items are not separately normalized (multi-year averaging smooths them partially). Share-based compensation is left as a real expense (not added back); see the SBC/OE disclosure. Capitalized at the 9–11% band as a cost-of-equity proxy; no leverage premium applied (net cash or debt within the no-charge range).

Reproduction value = tangible net assets $-16.75B + capitalized R&D $26.17B（FY 2026, 2025, 2024, 2023, 2022） = $10.77 / sh. Reproduction value = intangible-inclusive net reproduction (tangible net assets + acquired-intangible reset proxy + capitalized R&D), ÷ diluted shares; tangible net assets alone are negative for this asset-light franchise.

Moat reading: Franchise test compares earnings power (EPV) against reproduction value (tangible net assets + capitalized R&D). EPV well above reproduction value signals a moat; near it, a commodity; below it, value destruction. A directional reading, not a verdict.

Assumes a wide moat · competitive-advantage period ≈ 20 years (earnings intact, ROIC stable over history).

Growth value gated to zero — capex doubled within two years (AI-hog); growth credit stays in the owner-earnings DCF only.

Window FY 2026, 2025, 2024, 2023, 2022 · discount band 9%–11% · normalized tax 15% (Average effective tax rate over 5 year(s), capped at the statutory 21%.) · diluted shares.

Owner-earnings DCF: growth g₁ 2% · OE FY 2026, 2025, 2024, 2023, 2022 · Discount band: 9.60%–12.00% (DGS10 +4.5% to a 12% strict end, as of 2026-10-15). No enterprise→equity bridge: owner earnings already flow to shareholders (post-interest), so no net cash is added and no debt subtracted — matching the engine owner-earnings lamp.

What the price is betting

Today's price pencils in about 17.4% a year in owner-earnings for the next few years. Revenue actually grew 4.2% a year.

The market wants it well ahead of its own track record.

Even when the value band is low-confidence: use this to see what the price assumes — not as a cheapness confirmation.

How to read intrinsic value

SEC 13F · holders

Superinvestors Holding This Security

8 holders · $756.5M combined · this quarter +1 opened / -2 exited

This quarter1 opened6 trimmed2 exited
Holders 9 → 8 · last 8 quarters
Exited this quarter (2)
Donald YacktmanRay Dalio

SEC 13F · notes

Written summary

Cisco Systems Inc (CSCO) is held by 8 of the superinvestors tracked on Compounder, with a combined $756.5M in reported 13F value. The largest position belongs to Jim Cullen, where it makes up 3.0% of the portfolio.

Other notable holders by value include Nicolai Tangen (5.4% of its book), Richard Pzena (0.4% of its book) and Thomas Gayner (0.3% of its book).

In the quarter ended 2026-06-30, 1 of the tracked filers opened a new position in CSCO, 0 added to existing ones, 6 trimmed, and 2 sold out entirely.

Holder counts and values reflect the most recent SEC Form 13F filings, through the quarter ended 2026-06-30. Source: SEC EDGAR. A 13F shows only long US-listed positions and can lag the real portfolio by up to 45 days, so this is disclosed long ownership, not a complete picture.

How to read a 13F

SEC 13F · co-ownership

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Also on

Sources· SEC EDGAR 13F as of 2026-06-30 · filed 2026-08-14

Educational data only — not investment advice. 13F positions are self-reported and can lag up to 45 days.

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