Cisco's better-than-expected third-quarter earnings could be foreshadowing growth for the sector, Brian Marshall of ISI Group said Wednesday.
"I thought the quarter was pretty solid," he said, noting that the company saw growth across every major product category, as well as "decent" guidance despite a slow recovery in the broader economy.
Reuters reported that profit for its fiscal third quarter grew to $2.5 billion, or 46 cents per share, from $2.17 billion, or 40 cents per share, in the year-ago quarter.
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On CNBC's "Fast Money," Marshall said that Cisco was only a value stock if gross margins held, adding that he was "warming up" to it. Marshall had a "cautious" rating on Cisco shares.
Marshall also said that Cisco's results could be signaling a bottom in IT spending, noting that corporate budgets had been "pretty anemic" for the past 1½ years.
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"This could be very positive for others in the space, as well, like EMC, for example," he said.
"If we can get comfort going forward that software-defined networking is not going to jeopardize their gross margins over the longer term, then I think we can get constructive on the name."