Morgan Stanley Raises Cisco Price Target to $120 After Strong Earnings and AI Growth

Morgan Stanley has raised its price target for Cisco Systems from $91 to $120 following the technology giant's impressive third-quarter fiscal 2026 earnings report. Cisco reported record quarterly revenue of $15.8 billion, a 12% year-over-year increase, and non-GAAP earnings per share of $1.06, surpassing market expectations. The primary driver for the analyst upgrade was Cisco's significantly improved outlook on artificial intelligence infrastructure. The company raised its full-year AI order guidance from $5 billion to $9 billion, with year-to-date AI orders already reaching $5.3 billion. Morgan Stanley noted that all five major hyperscalers demonstrated triple-digit growth in AI-related orders, indicating broad-based demand rather than reliance on single clients. Although quarterly AI orders showed some volatility, management expressed confidence in meeting the revised annual targets. This performance challenges the previous narrative of Cisco as a legacy networking firm, highlighting its growing relevance in securing and connecting AI technologies. The strong results reflect a strengthening enterprise product cycle and robust relationships with hyperscale customers.