Cisco joins Goldman's technology growth list

NEW YORK: Goldman Sachs added Cisco Systems Inc to its list of favorite technology names and said a recent survey suggested business improvement, helping Cisco shares rise 2 percent by mid-morning on Monday.

Goldman analyst Simona Jankowski said a survey found that the percentage of companies that expect their network equipment spending to increase jumped to 54 percent from 42 percent. Jankowski said Cisco could exceed its own estimates and the company's financial analyst conference on September16 could provide a "positive catalyst."

"Despite a cautious near-term view of the business driven by the macro environment, we expect management to maintain its bullish long-term 12 to 17 percent growth outlook, and provide details around its strategy, product roadmap and business positioning that could bolster investors' confidence in those targets," she said.

Cisco shares were added to the Goldman Sachs Technology Framework's Favorite Growth list, and Jankowski said they appeared to be "very attractive" at 15 times earnings estimate for calendar 2009, below the sector's median of 18. Cisco's shares were up 48 cents at $22.74. The broader market was also up on Monday on news that the U.S. government had seized control of the troubled mortgage companies to stem market turbulence. The Nasdaq composite rose 0.8 percent.