Piper Sandler Cuts Cisco Price Target to $125, Citing Peaking Growth Concerns as Stock Falls 6%

Cisco Systems shares dropped roughly 5 to 6 percent on Tuesday to around $104.94, making it a notable outlier on a day when the broader technology sector was modestly higher. The Technology Select Sector SPDR Fund gained 0.38 percent and the Invesco QQQ Trust rose 0.52 percent, underscoring that the selloff was company-specific rather than sector-wide. Competing networking names Arista Networks and Ciena held broadly flat on the session.

The catalyst was a price target cut by Piper Sandler, which maintained its Hold rating on Cisco but reduced its target to $125 from $132. Analysts cited lower price-to-earnings multiple expectations driven by concerns that growth in the networking equipment industry is peaking. Although Cisco projected nearly 15 percent revenue growth, Piper Sandler analysts warned that sales growth could slip back into single digits, viewing the company's own guidance as conservative relative to broader market demand.

The decline comes after a period of significant outperformance. Cisco hit an all-time high in June, fueled by surging AI-related capital spending from large technology companies, and the stock had gained roughly 56 percent over the prior 12 months and about 38 percent year-to-date before Tuesday's drop. Piper Sandler's revised $125 target still sits well above where shares were trading, but the cut was enough to unsettle investors and weigh on the Dow Jones Industrial Average, which fell as much as 275 points at its session low with Cisco among the largest drags alongside JPMorgan Chase.