Cisco Systems Inc. (CSCO) shares rose 0.9% to $80.25 on Wednesday, finally eclipsing its March 27, 2000 record high - a date widely regarded as the peak of the dot-com bubble. The networking giant's return to all-time highs serves as both "a confidence marker" and "a reminder that recovery from bubbles can take decades," according to market analysts.
The milestone caps a 25-year journey for the former tech bellwether, whose recovery trajectory mirrors the prolonged process of investor confidence rebuilding after market collapses. Cisco's Wednesday close surpassed its previous peak set during the height of the internet frenzy, which also marked the Nasdaq 100's pre-2015 high.
The rally follows the Federal Reserve's third consecutive rate cut, fueling broad market gains. The S&P 500 advanced 0.7% while the Nasdaq 100 climbed 0.4% on the same day. Cisco's resurgence stems from robust revenue projections and optimism about artificial intelligence infrastructure spending accelerating growth.
"This comeback signals restored faith, but also shows how extended the healing process can be," said Dec Mullarkey, managing director at SLC Management, drawing parallels to Japan's multi-decade recovery from its late-1980s bubble. "When investor confidence gets shattered through painful selloffs, it often takes years to regain trust."
The achievement invites comparisons between today's "Magnificent Seven" tech dominance and the dot-com era's "Four Horsemen of Nasdaq" - when Cisco shared the spotlight with Microsoft, Intel and Dell. In the two years preceding its 2000 peak, Cisco's stock had soared nearly 600%, propelling its market capitalization above $500 billion before losing 90% of its value during the crash.
While Cisco's shares have rebounded over 800% since their 2002 trough, its current market cap remains more than 40% below its bubble-era zenith. Analysts note the company has transitioned into more of a "tech utility" than innovator - a shift apparently welcomed by investors.
The latest surge follows Cisco's strong revenue forecast last month, with the San Jose-based company projecting fiscal year sales up to $61 billion - $1 billion above Wall Street estimates. The firm is repositioning to capture opportunities from billions in global AI infrastructure investments, prompting UBS analyst David Vogt to upgrade the stock to "buy" ahead of its Q1 earnings.
However, skepticism persists on Wall Street regarding the sustainability of AI spending momentum and associated accounting practices.
Market risks remain, and investors should exercise caution. This analysis does not constitute personal investment advice nor account for individual financial circumstances.