Cisco just got crushed by earnings, but is the blue-chip stock still a long-term buy?
Sundry Photography/iStock Editorial via Getty Images         
Cisco Systems (NASDAQ:CSCO) has dropped more than 25% in 2022, including a sizable selloff in the wake of its recent earnings report, which marked its worst single-day loss in more than a decade. However, technical signals and a large contingent of Wall Street analysts think the slide may have washed out all the likely sellers and set the stock up for a recovery.
Should you buy the stock now as a bet on a long-term bounce back?
Fighting Revenue Headwinds
Shares of the maker of networking equipment have dropped about 28% since the end of the 2021. And that retreat represents an improvement compared to its position last month -- the stock has climbed 11% since hitting an 18-month trading low in May.    In late May, the company reported third-quarter results and guidanceÂ that were both weaker than forecasted. The disappointing quarterly update triggered a 13% single-session drop. This was the worst one-day decline sinceÂ Feb. 10, 2011, when it closed lower by 14%.          In its Q3 earnings report, the firm beat non-GAAP EPS projections, reporting a figure of $0.87, which topped consensus by $0.01. However, revenue totals stagnated from last year, rising just 0.3% to $12.84B. This was $500M below the amount Wall Street experts were targeting.
Chuck Robbins, the CEO of CSCO, tried to give the results a positive spin, saying in a statement: "We continued to see solid demand for our technologies and our business transformation is progressing well."      Unfortunately, Wall Street didnât seem to buy the optimistic portrayal of the results. Wells Fargo analyst Aaron Rakers, who has an Equal Weight rating on Cisco, lowered his price target on the company's stock to $52 a share from $65. Moreover, Morgan Stanley analyst Meta Marshall, who rates Cisco's stock at Equal Weight with a $46-a-share price target, advised caution following the financial figures.      Is CSCO a Buy?  Despite troubled earnings, CSCO may have sold off enough to make it an interesting buying opportunity. Technical analysis points to this possibility, as CSCO sits near oversold levels when examining the Relative Strength Index indicator.
On a weekly chart, CSCO lands right on the 33 handle of the RSI. This sits just a few points above the 30 marker which is widely considered oversold territory.
Meanwhile, the firm has solid backing from the Wall Street community. Of the 29 analysts surveyed by Seeking Alpha, more than half have a bullish rating on the stock, with 15 listing it with either a Strong Buy or Buy rating. Meanwhile, 13 label CSCO as a Hold and just one has issued a Sell opinion.Â     Additionally, the average price target for CSCO is $54.13 a share, with $73 being the top target and $40 a share being the low point. With the stock sitting at $45.45 in Friday's midday trading, the average price target would represent a 19% rally.
See table below:

Quantitative measures present a more mixed view of the stock. According to Seeking Alpha's Quant Ratings, CSCO gets grades of A+ and B for profitability and valuation. However, the firm gets a C+ for momentum and an F for growth.
Seeking Alpha contributor Dividend Sensei feels that this current bear market has become a blue-chip bargain hunting bonanza, and CSCO falls within this category.
At the same time, contributor Brian Gilmartin says it's time to sell, as the stock has shown no growth in the emerging segments of security or applications proving they seem to be marginal products in their space.