Cramer's Morning Take: Cisco Systems 7/17/25

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Jim Cramer (0:10)

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Jim Cramer (0:49)

Hey, it's Cramer, and this is my morning take on the market from today's CNBC Investing Club morning meeting.

Jeff Marks (0:55)

Let's get into some stocks, got some good stuff, some bad stuff happening today. Let's talk about a new buy first. Cisco calling it up from the bullpen. It's roughly unchanged since we first added it on June 23rd. This is a networking equipment powerhouse, also cybersecurity through the Splunk deal. But they have this newer AI angle to it.

For so many years, Cisco known as really serving enterprise customers, but now they're really emphasizing the cloud computing side.

Jim Cramer (1:20)

You look at Oracle, they're going to be in all the Oracle data centers. He's Jensen's partner and the stock did not move that much when they announced that. They have a guy who is great at cybersecurity, who's moving on up.

They're going to be the way that you connect all these data centers to the rest of your system.

Jeff Marks (1:42)

Yes, so they reached their goal of a billion in AI infrastructure orders from web scale customers. Web scale is another word for the hyperscaler customers. That's what they refer to them as. They hit that goal a quarter early. Some other things to like here, there's an ongoing transition to software revenues, which are especially subscription software, which are predictable. They're sticky, they're higher margin. So the gross margin profile at the company has been going up steadily through the years. You've got a buy back, 2.4% dividend yield, valuation on demanding, high teams multiple.

Jim Cramer (2:14)

People just think it's the same old Cisco, like they didn't buy Splunk. Splunk gave them visibility, it gave them some very good cyber defense work, but it gave them contacts. Splunk was everywhere and I don't think people realize how embedded Splunk was. Now you've got a company that could have an Oracle-like revaluation and the Oracle-like revaluation is stunning.

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