Stock Analysis on Net
Stock Analysis on Net

Cisco Systems Inc. (NASDAQ:CSCO)

Paying users zone. Data is hidden behind: .

  • Get 1-month access to Cisco Systems Inc. for $19.99, or

  • get full access to the entire website for at least 3 months from $49.99.


We accept:

Visa Mastercard American Express Maestro Discover JCB PayPal Apple Pay Google Pay
Verified by Visa MasterCard SecureCode American Express SafeKey

This is a one-time payment. There is no automatic renewal.

Capital Asset Pricing Model (CAPM)

Microsoft Excel LibreOffice Calc

Capital asset pricing model (CAPM) indicates what should be the expected or required rate of return on risky assets like Cisco Systems Inc.’s common stock.


Rates of Return

Cisco Systems Inc., monthly rates of return

Microsoft Excel LibreOffice Calc
Cisco Systems Inc. (CSCO) Standard & Poor’s 500 (S&P 500)
t Date PriceCSCO,t1 DividendCSCO,t1 RCSCO,t2 PriceS&P 500,t RS&P 500,t3
Aug 31, 2015
1. Sep 30, 2015
2. Oct 31, 2015
3. Nov 30, 2015
. . . . . . .
. . . . . . .
. . . . . . .
70. Jun 30, 2021
71. Jul 31, 2021
Average (R):
Standard deviation:
Cisco Systems Inc. (CSCO) Standard & Poor’s 500 (S&P 500)
t Date PriceCSCO,t1 DividendCSCO,t1 RCSCO,t2 PriceS&P 500,t RS&P 500,t3
Aug 31, 2015
1. Sep 30, 2015
2. Oct 31, 2015
3. Nov 30, 2015
4. Dec 31, 2015
5. Jan 31, 2016
6. Feb 29, 2016
7. Mar 31, 2016
8. Apr 30, 2016
9. May 31, 2016
10. Jun 30, 2016
11. Jul 31, 2016
12. Aug 31, 2016
13. Sep 30, 2016
14. Oct 31, 2016
15. Nov 30, 2016
16. Dec 31, 2016
17. Jan 31, 2017
18. Feb 28, 2017
19. Mar 31, 2017
20. Apr 30, 2017
21. May 31, 2017
22. Jun 30, 2017
23. Jul 31, 2017
24. Aug 31, 2017
25. Sep 30, 2017
26. Oct 31, 2017
27. Nov 30, 2017
28. Dec 31, 2017
29. Jan 31, 2018
30. Feb 28, 2018
31. Mar 31, 2018
32. Apr 30, 2018
33. May 31, 2018
34. Jun 30, 2018
35. Jul 31, 2018
36. Aug 31, 2018
37. Sep 30, 2018
38. Oct 31, 2018
39. Nov 30, 2018
40. Dec 31, 2018
41. Jan 31, 2019
42. Feb 28, 2019
43. Mar 31, 2019
44. Apr 30, 2019
45. May 31, 2019
46. Jun 30, 2019
47. Jul 31, 2019
48. Aug 31, 2019
49. Sep 30, 2019
50. Oct 31, 2019
51. Nov 30, 2019
52. Dec 31, 2019
53. Jan 31, 2020
54. Feb 29, 2020
55. Mar 31, 2020
56. Apr 30, 2020
57. May 31, 2020
58. Jun 30, 2020
59. Jul 31, 2020
60. Aug 31, 2020
61. Sep 30, 2020
62. Oct 31, 2020
63. Nov 30, 2020
64. Dec 31, 2020
65. Jan 31, 2021
66. Feb 28, 2021
67. Mar 31, 2021
68. Apr 30, 2021
69. May 31, 2021
70. Jun 30, 2021
71. Jul 31, 2021
Average (R):
Standard deviation:

Show all

1 Data in US$ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of CSCO during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t


Variance and Covariance

Cisco Systems Inc., calculation of variance and covariance of returns

Microsoft Excel LibreOffice Calc
t Date RCSCO,t RS&P 500,t (RCSCO,tRCSCO)2 (RS&P 500,tRS&P 500)2 (RCSCO,tRCSCO)×(RS&P 500,tRS&P 500)
1. Sep 30, 2015
2. Oct 31, 2015
3. Nov 30, 2015
. . . . . . .
. . . . . . .
. . . . . . .
70. Jun 30, 2021
71. Jul 31, 2021
Total (Σ):
t Date RCSCO,t RS&P 500,t (RCSCO,tRCSCO)2 (RS&P 500,tRS&P 500)2 (RCSCO,tRCSCO)×(RS&P 500,tRS&P 500)
1. Sep 30, 2015
2. Oct 31, 2015
3. Nov 30, 2015
4. Dec 31, 2015
5. Jan 31, 2016
6. Feb 29, 2016
7. Mar 31, 2016
8. Apr 30, 2016
9. May 31, 2016
10. Jun 30, 2016
11. Jul 31, 2016
12. Aug 31, 2016
13. Sep 30, 2016
14. Oct 31, 2016
15. Nov 30, 2016
16. Dec 31, 2016
17. Jan 31, 2017
18. Feb 28, 2017
19. Mar 31, 2017
20. Apr 30, 2017
21. May 31, 2017
22. Jun 30, 2017
23. Jul 31, 2017
24. Aug 31, 2017
25. Sep 30, 2017
26. Oct 31, 2017
27. Nov 30, 2017
28. Dec 31, 2017
29. Jan 31, 2018
30. Feb 28, 2018
31. Mar 31, 2018
32. Apr 30, 2018
33. May 31, 2018
34. Jun 30, 2018
35. Jul 31, 2018
36. Aug 31, 2018
37. Sep 30, 2018
38. Oct 31, 2018
39. Nov 30, 2018
40. Dec 31, 2018
41. Jan 31, 2019
42. Feb 28, 2019
43. Mar 31, 2019
44. Apr 30, 2019
45. May 31, 2019
46. Jun 30, 2019
47. Jul 31, 2019
48. Aug 31, 2019
49. Sep 30, 2019
50. Oct 31, 2019
51. Nov 30, 2019
52. Dec 31, 2019
53. Jan 31, 2020
54. Feb 29, 2020
55. Mar 31, 2020
56. Apr 30, 2020
57. May 31, 2020
58. Jun 30, 2020
59. Jul 31, 2020
60. Aug 31, 2020
61. Sep 30, 2020
62. Oct 31, 2020
63. Nov 30, 2020
64. Dec 31, 2020
65. Jan 31, 2021
66. Feb 28, 2021
67. Mar 31, 2021
68. Apr 30, 2021
69. May 31, 2021
70. Jun 30, 2021
71. Jul 31, 2021
Total (Σ):

Show all

VarianceCSCO = Σ(RCSCO,tRCSCO)2 ÷ (71 – 1)
= ÷ (71 – 1)
=

VarianceS&P 500 = Σ(RS&P 500,tRS&P 500)2 ÷ (71 – 1)
= ÷ (71 – 1)
=

CovarianceCSCO, S&P 500 = Σ(RCSCO,tRCSCO)×(RS&P 500,tRS&P 500) ÷ (71 – 1)
= ÷ (71 – 1)
=


Systematic Risk (β) Estimation

Microsoft Excel LibreOffice Calc
VarianceCSCO
VarianceS&P 500
CovarianceCSCO, S&P 500
Correlation coefficientCSCO, S&P 5001
βCSCO2
αCSCO3

Calculations

1 Correlation coefficientCSCO, S&P 500
= CovarianceCSCO, S&P 500 ÷ (Standard deviationCSCO × Standard deviationS&P 500)
= ÷ ( × )
=

2 βCSCO
= CovarianceCSCO, S&P 500 ÷ VarianceS&P 500
= ÷
=

3 αCSCO
= AverageCSCO – βCSCO × AverageS&P 500
= ×
=


Expected Rate of Return

Microsoft Excel LibreOffice Calc
Assumptions
Rate of return on LT Treasury Composite1 RF
Expected rate of return on market portfolio2 E(RM)
Systematic risk (β) of Cisco Systems Inc.’s common stock βCSCO
 
Expected rate of return on Cisco Systems Inc.’s common stock3 E(RCSCO)

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

2 See details »

3 E(RCSCO) = RF + βCSCO [E(RM) – RF]
= + []
=