Cisco's Overweight rating reaffirmed at Morgan Stanley on potential upgrade cycle

Morgan Stanley reiterated its Overweight rating on Cisco Systems (NASDAQ:CSCO) with a $67 price target.

Analysts led by Meta Marshall said that Campus switching is Cisco's largest product segment, where a nearly $60B installed base should begin an upgrade in fiscal year 2026, about eight years after the last cycle.

The analysts believe this refresh could contribute around 300 basis points, or bps, to 370 bps of growth to fiscal 2026, higher if accompanied by WiFi upgrade, thus contributing to the Overweight rating.

However, the analysts noted that macro is the biggest risk for now.

Marshall and her team added that bull case is that campus upgrade cycle pulls through additional WiFi upgrade/AI/Splunk, and is a bigger contributor, while the bear case is that macro pushes out the upgrade.