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Top Pros: Cisco is Classic Value Trap

Shares of Cisco first climbed but then turned lower in extended trade after the company beat Street expectations but warned of another weak quarter as it struggles to revive growth.

"This quarter played out as we expected," said John Chambers, chairman and CEO of Cisco, in a prepared statement. "We have acknowledged our challenges. We know what we have to do. We have a clear game plan, and we are a company with a track record of market- shaping innovation."

Earlier this month, Cisco announced plans to further streamline its sales, services, and engineering organizations and refocus around five growth markets. And in April, Cisco announced that it would dump its Flip video camera.

By the numbers, the company said it earned 42 cents a share, excluding one-time items, on revenue of $10.87 billion in the fiscal third quarter.

Analysts expected the firm to turn in a profit of 37 cents a share on sales of $10.86 billion, according to Thomson Reuters estimates.

Is Cisco a value trade or a broken stock? What’s the play?

Guy Adami does not think the stock is a buy. "I know valuations make sense but the stock can not get out of its own way. It feels like it wants to put up a 16-and a half handle. Frankly I'd rather own Juniper," he says.

Gleacher analyst Brian Marshall calls Cisco "a classic value trap." He believes the transition underway at the company will take multiple quarters to achieve "and there’s no need to hang out while it happens."

"I think John Chambers has lost his credibility and you have to question whether he should remain at the helm of this company," says Joe Terranova. "I don't think he should." Although Terranova didn't say it outright, it sounds like he thinks the stock is pretty broken.

Tim Seymour sees results as an endorsement for HP. "They're taking away Cisco's market share."








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Trader disclosure: On May 11, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Pete Najarian owns (PFE); Pete Najarian owns (MRK); Pete Najarian owns (AAPL); Pete Najarian owns (TCK); Pete Najarian owns (AKAM); Pete Najarian owns (C); Pete Najarian owns (HPQ); Pete Najarian owns (TEVA); Pete Najarian owns (MS); Pete Najarian owns (RSX); Pete Najarian owns (GE); Pete Najarian owns (MSFT); Pete Najarian owns (YHOO); Pete Najarian owns (VLO); Pete Najarian owns (TER); Pete Najarian is long (RIMM) calls; Pete Najarian is long (AVL) calls; Pete Najarian is long (NTAP) calls; Pete Najarian is long (XLF) calls; Pete Najarian is long (PMCS) calls; Pete Najarian is long (CVS) calls; Pete Najarian is long (XL) calls; Pete Najarian is long (BSX) calls; Pete Najarian is long (HBC) calls; Pete Najarian is long (EWZ) calls; Pete Najarian is long (XLI) calls; Pete Najarian is long (FCX) calls; Finerman owns (M); Finerman owns (CMI); Finerman owns (LEA); Finerman owns (MSFT); Finerman is short SPY; Finerman is short (MDY); Finerman is short (IWM); Finerman is Long S&P 500 Puts; Finerman is Long Russell 2000 Puts; Terranova owns (VRTS); Terranova owns (AAPL); Terranova owns (JPM); Terranova owns (V); Terranova owns (BX); Terranova owns (UPL); Terranova owns (BAX); Terranova owns (PFE); Terranova owns (PEP); Terranova owns (MCD); Terranova owns (TM); Terranova owns (DIS); Terranova owns (BJ); Terranova owns (APA); Terranova owns (OXY); Terranova owns (XOM); Adami owns (AGU); Adami owns (C); Adami owns (GS); Adami owns (MSFT); Adami owns (NUE); Adami owns (BTU)

For Brian Kelly
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For Joe Terranova
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Dan Niles
Niles and Alpha One own (AUO), (PAY), (NXPI)

Mike Khouw
**No Disclosures




CNBC.com with wires.