Two Cisco Systems (NASDAQ:CSCO) executives have recently sold a lot of shares in the company. Cisco’s shares have underperformed the market year-to-date, over the past 52 weeks, and over the past decade. Cisco’s shares have decreased by 11.2% year-to-date, by 32.25% over the past 52 weeks, and, over the past decade, have increased by 30%. Corresponding numbers for the Nasdaq Index (NASDAQ:QQQ) are: an increase of 5.3%, an increase of 14%, and an increase of 60%, respectively.
Cisco remained very profitable in 2010, with a net profit margin of 19.4%, an operating margin of 22.89%, and an EBITD margin of 27.96%. However, its return on average assets and return on equity declined in the first quarter of 2011 from comparable numbers in 2010, suggesting that its debt levels may be impacting its performance. It current has $15.24 billion in debt on its balance sheet, or roughly 33% of total equity. Its price-to-earnings growth ratio is 1.05, suggesting that it is increasingly a value stock. Its forward price-to-earnings ratio is only 10.13. Despite all the negatives, only 1% of its shares are sold short.
Following is information on these recent transactions:
- Mark D. Chandler, who is Senior Vice President, Legal Services, General Counsel & Secretary, exercsed 30,000 options on April 4th, 2011 at a cost of $16.13 per option. He subsequently sold 30,000 shares at a market price of $170.02 on April 4th. Net proceeds for these transactions were $26,100. He presently holds 414,090 shares worth $7,341,815.70 as of today’s trading.
- Larry R. Carter, who is a Director and former Senior Vice President, exercised 500,000 options at costs between $9.75 and $16.15 on March 21st, 22nd, 24th and 25th. He subsequently sold 500,000 shares at market prices between $17.29 and $17.52 per share on March 21st, 22nd, 24th, and 25th. Net proceeds for these transactions were $2,243,651. He presently holds 76,876 shares worth $1,363,011.48 as of today’s trading.
Other insiders include:
- Carol Bartz: She is the Chief Executive Officer of Yahoo! Inc. (NASDAQ:YHOO).
- M. Michele Burns: She is the Chairman and Chief Executive Officer of Mercer LLC(NASDAQ:MERC).
- Michael D. Capellas: He is the Acadia Enterprises, LLC and Chairman of the Board, Virtual Computing Environment coalition.
- John T. Chambers: Chairman and Chief Executive Officer, Cisco Systems, Inc.(NASDAQ:CSCO).
- Brian L. Halla: Chairman and Chief Executive Officer, National Semiconductor Corporation (NYSE:NSM).
- John L. Hennessy Ph.D: President, Stanford University.
- Richard Kovacevich: Chairman Emeritus, Wells Fargo & Company (NYSE:WFC)
- Roderick C. McGeary: Chairman, Tegile Systems, Inc.
- Arun Sarin, KBE: Former Chief Executive Officer, Vodafone Group Plc(NASDAQ:VOD), and Senior Advisor, Kohlberg Kravis Roberts & Company(NYSE:KKR)
- Steven M. West: Founder and Partner, Emerging Company Partners
- Jerry Yang: Co-Founder and Chief Yahoo, Yahoo! Inc. (NASDAQ:YHOO).
About the company: Cisco Systems, Inc. supplies data networking products for the Internet. The Company’s Internet Protocol-based networking solutions are installed at corporations, public institutions and telecommunications companies worldwide. The Company’s solutions transport data, voice, and video within buildings, across campuses, and around the world.