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ARM vs. CSCO: A Head-to-Head Stock Comparison

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Here’s a clear look at ARM and CSCO, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.

Company Profile

ARM trades as an American Depositary Receipt (ADR), offering U.S. investors a convenient way to access its foreign-listed shares. In contrast, CSCO is a standard domestic listing.

SymbolARMCSCO
Company NameArm Holdings plcCisco Systems, Inc.
CountryUnited KingdomUnited States
GICS SectorInformation TechnologyInformation Technology
GICS IndustrySemiconductors & Semiconductor EquipmentCommunications Equipment
Market Capitalization138.93 billion USD265.76 billion USD
ExchangeNasdaqGSNasdaqGS
Listing DateSeptember 14, 2023February 16, 1990
Security TypeADRCommon Stock

Historical Performance

This chart compares the performance of ARM and CSCO by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.

ARM vs. CSCO: Growth of a $10,000 investment over the past one year.

Historical Performance at a Glance

SymbolARMCSCO
5-Day Price Return-5.36%-3.16%
13-Week Price Return-1.43%4.99%
26-Week Price Return-13.77%5.12%
52-Week Price Return2.85%34.27%
Month-to-Date Return-5.21%-1.42%
Year-to-Date Return8.63%13.36%
10-Day Avg. Volume4.00M27.80M
3-Month Avg. Volume5.00M20.51M
3-Month Volatility46.58%19.17%
Beta2.730.98

Profitability

Return on Equity (TTM)

ARM

10.64%

Semiconductors & Semiconductor Equipment Industry

Max
52.74%
Q3
23.49%
Median
11.60%
Q1
3.23%
Min
-20.69%

ARM’s Return on Equity of 10.64% is on par with the norm for the Semiconductors & Semiconductor Equipment industry, indicating its profitability relative to shareholder equity is typical for the sector.

CSCO

22.74%

Communications Equipment Industry

Max
32.05%
Q3
19.58%
Median
11.77%
Q1
2.23%
Min
-11.93%

In the upper quartile for the Communications Equipment industry, CSCO’s Return on Equity of 22.74% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.

ARM vs. CSCO: A comparison of their Return on Equity (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Net Profit Margin (TTM)

ARM

16.96%

Semiconductors & Semiconductor Equipment Industry

Max
44.17%
Q3
22.38%
Median
11.95%
Q1
3.21%
Min
-25.16%

ARM’s Net Profit Margin of 16.96% is aligned with the median group of its peers in the Semiconductors & Semiconductor Equipment industry. This indicates its ability to convert revenue into profit is typical for the sector.

CSCO

18.45%

Communications Equipment Industry

Max
23.65%
Q3
14.32%
Median
5.31%
Q1
1.45%
Min
-12.72%

A Net Profit Margin of 18.45% places CSCO in the upper quartile for the Communications Equipment industry, signifying strong profitability and more effective cost management than most of its peers.

ARM vs. CSCO: A comparison of their Net Profit Margin (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Operating Profit Margin (TTM)

ARM

18.51%

Semiconductors & Semiconductor Equipment Industry

Max
58.03%
Q3
27.84%
Median
12.45%
Q1
5.15%
Min
-28.61%

ARM’s Operating Profit Margin of 18.51% is around the midpoint for the Semiconductors & Semiconductor Equipment industry, indicating that its efficiency in managing core business operations is typical for the sector.

CSCO

21.38%

Communications Equipment Industry

Max
42.27%
Q3
18.90%
Median
6.21%
Q1
2.97%
Min
-20.72%

An Operating Profit Margin of 21.38% places CSCO in the upper quartile for the Communications Equipment industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.

ARM vs. CSCO: A comparison of their Operating Profit Margin (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Profitability at a Glance

SymbolARMCSCO
Return on Equity (TTM)10.64%22.74%
Return on Assets (TTM)8.01%8.58%
Net Profit Margin (TTM)16.96%18.45%
Operating Profit Margin (TTM)18.51%21.38%
Gross Profit Margin (TTM)97.14%65.56%

Financial Strength

Current Ratio (MRQ)

ARM

4.99

Semiconductors & Semiconductor Equipment Industry

Max
8.42
Q3
4.70
Median
2.75
Q1
2.07
Min
1.04

ARM’s Current Ratio of 4.99 is in the upper quartile for the Semiconductors & Semiconductor Equipment industry. This signifies a strong liquidity position, suggesting the company is well-equipped to cover its immediate liabilities compared to its peers.

CSCO

1.01

Communications Equipment Industry

Max
1.72
Q3
1.72
Median
1.46
Q1
1.18
Min
0.93

CSCO’s Current Ratio of 1.01 falls into the lower quartile for the Communications Equipment industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.

ARM vs. CSCO: A comparison of their Current Ratio (MRQ) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Debt-to-Equity Ratio (MRQ)

ARM

0.00

Semiconductors & Semiconductor Equipment Industry

Max
1.09
Q3
0.45
Median
0.22
Q1
0.01
Min
0.00

Falling into the lower quartile for the Semiconductors & Semiconductor Equipment industry, ARM’s Debt-to-Equity Ratio of 0.00 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.

CSCO

0.60

Communications Equipment Industry

Max
1.55
Q3
0.92
Median
0.55
Q1
0.30
Min
0.00

CSCO’s Debt-to-Equity Ratio of 0.60 is typical for the Communications Equipment industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.

ARM vs. CSCO: A comparison of their Debt-to-Equity Ratio (MRQ) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Interest Coverage Ratio (TTM)

ARM

6.95

Semiconductors & Semiconductor Equipment Industry

Max
174.00
Q3
81.10
Median
27.22
Q1
7.28
Min
-4.26

In the lower quartile for the Semiconductors & Semiconductor Equipment industry, ARM’s Interest Coverage Ratio of 6.95 indicates a tighter cushion for servicing debt, suggesting less financial flexibility than many of its competitors.

CSCO

20.35

Communications Equipment Industry

Max
181.73
Q3
113.63
Median
7.59
Q1
3.82
Min
-5.39

CSCO’s Interest Coverage Ratio of 20.35 is positioned comfortably within the norm for the Communications Equipment industry, indicating a standard and healthy capacity to cover its interest payments.

ARM vs. CSCO: A comparison of their Interest Coverage Ratio (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Financial Strength at a Glance

SymbolARMCSCO
Current Ratio (MRQ)4.991.01
Quick Ratio (MRQ)4.770.92
Debt-to-Equity Ratio (MRQ)0.000.60
Interest Coverage Ratio (TTM)6.9520.35

Growth

Revenue Growth

ARM vs. CSCO: A side-by-side comparison of their Revenue Growth for the MRQ (YoY), TTM (YoY), 3-Year CAGR, and 5-Year CAGR periods.

EPS Growth

ARM vs. CSCO: A side-by-side comparison of their EPS Growth for the MRQ (YoY), TTM (YoY), 3-Year CAGR, and 5-Year CAGR periods.

Dividend

Dividend Yield (TTM)

ARM

0.00%

Semiconductors & Semiconductor Equipment Industry

Max
4.16%
Q3
1.78%
Median
0.74%
Q1
0.00%
Min
0.00%

ARM currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.

CSCO

2.42%

Communications Equipment Industry

Max
3.88%
Q3
2.75%
Median
0.93%
Q1
0.00%
Min
0.00%

CSCO’s Dividend Yield of 2.42% is consistent with its peers in the Communications Equipment industry, providing a dividend return that is standard for its sector.

ARM vs. CSCO: A comparison of their Dividend Yield (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Dividend Payout Ratio (TTM)

ARM

0.00%

Semiconductors & Semiconductor Equipment Industry

Max
196.12%
Q3
87.72%
Median
26.57%
Q1
0.00%
Min
0.00%

ARM has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.

CSCO

61.58%

Communications Equipment Industry

Max
111.16%
Q3
55.91%
Median
28.42%
Q1
0.00%
Min
0.00%

CSCO’s Dividend Payout Ratio of 61.58% is in the upper quartile for the Communications Equipment industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.

ARM vs. CSCO: A comparison of their Dividend Payout Ratio (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Dividend at a Glance

SymbolARMCSCO
Dividend Yield (TTM)0.00%2.42%
Dividend Payout Ratio (TTM)0.00%61.58%

Valuation

Price-to-Earnings Ratio (TTM)

ARM

203.03

Semiconductors & Semiconductor Equipment Industry

Max
109.37
Q3
57.11
Median
28.95
Q1
22.13
Min
11.14

At 203.03, ARM’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Semiconductors & Semiconductor Equipment industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.

CSCO

25.42

Communications Equipment Industry

Max
57.30
Q3
47.92
Median
27.50
Q1
17.89
Min
13.89

CSCO’s P/E Ratio of 25.42 is within the middle range for the Communications Equipment industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.

ARM vs. CSCO: A comparison of their Price-to-Earnings Ratio (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Price-to-Sales Ratio (TTM)

ARM

34.44

Semiconductors & Semiconductor Equipment Industry

Max
16.09
Q3
10.10
Median
4.82
Q1
2.60
Min
0.93

With a P/S Ratio of 34.44, ARM trades at a valuation that eclipses even the highest in the Semiconductors & Semiconductor Equipment industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.

CSCO

4.69

Communications Equipment Industry

Max
11.03
Q3
5.53
Median
2.20
Q1
0.99
Min
0.40

CSCO’s P/S Ratio of 4.69 aligns with the market consensus for the Communications Equipment industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.

ARM vs. CSCO: A comparison of their Price-to-Sales Ratio (TTM) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Price-to-Book Ratio (MRQ)

ARM

24.45

Semiconductors & Semiconductor Equipment Industry

Max
13.56
Q3
6.75
Median
3.68
Q1
1.89
Min
0.60

At 24.45, ARM’s P/B Ratio is at an extreme premium to the Semiconductors & Semiconductor Equipment industry. This signifies that the market’s valuation is heavily reliant on future potential rather than its current net asset value, which can be a high-risk proposition.

CSCO

5.71

Communications Equipment Industry

Max
9.66
Q3
5.60
Median
3.73
Q1
2.67
Min
0.30

CSCO’s P/B Ratio of 5.71 is in the upper tier for the Communications Equipment industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.

ARM vs. CSCO: A comparison of their Price-to-Book Ratio (MRQ) against their respective Semiconductors & Semiconductor Equipment and Communications Equipment industry benchmarks.

Valuation at a Glance

SymbolARMCSCO
Price-to-Earnings Ratio (TTM)203.0325.42
Price-to-Sales Ratio (TTM)34.444.69
Price-to-Book Ratio (MRQ)24.455.71
Price-to-Free Cash Flow Ratio (TTM)199.6020.00