With HP and eBay breakups already underway, could Cisco be next?


CEO John Chambers has said he wants Cisco to be the biggest IT provider in the universe. RBC Capital Markets Analyst Mark Sue thinks Chambers should break it up instead.

Given that [company]Hewlett-Packard[/company] is already bifurcating itself into an enterprise company and a PC-and-printer vendor, [company]eBay[/company] is breaking out PayPal as a separate entity, and Elliott Management is pushing EMC to spin out VMware, it’s clear that big companies are under tremendous pressure to “maximize shareholder value” by breaking themselves apart.

Sue’s take is that splitting up [company]Cisco[/company] could push the stock to $40 per share or more for the first time in 14 years and unlock value in high-growth areas including the internet of things, wireless and security arenas. “eBay, [company]Agilent[/company], JDSU and even HP this morning get high marks from investors for their ability to adapt to a changing world,” Sue wrote.

His take is that Cisco could put its traditional networking hardware —…

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