By 2016, annual IP traffic is predicted to reach 1.3 zettabytes
(to put that in perspective, there are one trillion gigabytes in a
single zettabyte.) There are several reasons for this growth in
Alongside rising Internet traffic are diminishing fears over cloud
security. The initial resistance to putting information on the
cloud has eased as we have seen no systemic issues in security.
As Internet traffic and acceptance of cloud security increase, so
will the cloud industry as a whole. Leading technology research
company Gartner predicts the cloud market to grow by 19% to $131
billion in 2013.
The market will see major gains within this sector. How can
investors position themselves for profit? One company set to reap
the benefits of the growing cloud within the coming years is
Cisco has been dominating the market for physical networking
equipment - including switches and routers - for some time now. But
Cisco wants to be bigger. So the company is switching gears to a
new strategy focused on the Internet of Everything (IoE).
Simply defined, the IoE refers to the idea of an increased
connectivity between all objects. Until now, the Internet has been
a people-centered medium, but non-human objects and machinery are
now gaining an increasing amount of access.
For example: Mirrors that can provide basic medical analysis by
measuring temperature and pupil dilation, billboards that can
target ads based on viewer data and location, and livestock being
connected to the Web to monitor dietary patterns.
Cisco aims to play a major role in this revolution by connecting
these objects through networking and data storage. The company is
accomplishing this goal by dropping its consumer-based hardware and
aggressively moving towards cloud computing.
Imagine entering a museum and automatically receiving a guided tour
on your smartphone. Better yet, imagine what retailers would pay to
gain access to the shopping history of potential in-store
This idea is similar to the way
) stores your search history to recommend products, only with
applications to the physical world. By creating an infrastructure
of networking and intelligent location sensors, Cisco is going to
provide a unique and highly-demanded service.
Cisco has some very attractive numbers supporting it to boot. The
company's balance sheet shows $47.39 billion or $8.87 in cash per
share with only $16 billion in total debt.
Cisco has also treated investors well, increasing dividends by 180%
since 2011 and producing record revenue levels for nine straight
quarters. And despite the increased dividends, Cisco has held on to
a payout ratio below 30% and a dividend yield of 2.8%.
If you are looking for a solid blue chip winner to hold onto for
the next two years, look no further than Cisco.
Editor's Note: This article was written by Christian DeHaemer
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