Does Cisco’s $5B Purchase of NDS Make it a Buy?
Cisco Systems on Thursday announced its $5 billion acquisition of video technology developer NDS Group, but did that make it a stock to own?
Stephanie Link, director of strategy and vice president at TheStreet.com, wasn’t a buyer following news of the acquisition.
“I just feel like there’s other places in technology that have faster end-market growth,” she said on “Fast Money.” “I just don’t see the real synergies there.”
Brian Modoff, an analyst at Deutsche Bank, sounded bullish on the purchase.
“It’s a complimentary deal for the company. It’s the kind we like to see, something that fits into something they’re already doing and focused on, not something off into the wheat,” he said.
Modoff also said that NDS Group had a healthy growth rate and brought exposure to emerging markets.
Modoff had a price target of $24 per share for Cisco. The stock closed at $19.91, down 1.4 percent.
Pete Najarian of OptionMonster.com also wasn’t a buyer.
“The fact that they continue to grow in the cloud space, in the video space actually is interesting to me, but I still don’t see the same kind of upside I see in Cisco right now the way I do in names like Intel, names like Microsoft that not only are hitting 52-week highs, but exploding through those highs,” he said. “And they’re giving you a nice dividend, better than what you’re getting at Cisco.”
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Trader disclosure: On March 15, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders: Kelly is long SMH; Kelly is long MXN; Kelly is short JPY; Kelly is short Aussie dollar; New Zealand dollar; Grasso is long ASTM; Grasso is long AVAV; Grasso is long BA; Grasso is long D; Grasso is long MHY; Grasso is long NUAN; Grasso is long MO; Grasso is long PFE; Grasso is long PRST; Grasso is long S; Grasso is long XLU; Link is long STI; Link is long JPM; Link is long USB; Link is long TJX; Cortes is long Treasuries; Cortes is long PPH; Cortes is long DEO; Cortes is long SO; Cortes is long SBUX; Cortes is short USD vs. JPY; Cortes is short AAPL
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