Cisco stock jumps 15% as traders pile into calls

Cisco shares rose about 15% as traders bought large volumes of call options ahead of the company’s upcoming earnings report.

Options volume on Cisco climbed sharply as investors purchased bullish contracts at a pace market participants likened to past retail-driven surges.

The buying reflected bets that Cisco could repeat a post-earnings rally. After its last quarterly report the stock rose more than 16% when the company reported record revenue and issued upbeat guidance that referenced AI-related products.

Traders and analysts pointed to Cisco’s focus on AI data-center networking as a factor behind the trades. Cisco has outlined investments and product road maps aimed at AI infrastructure, and some market participants are wagering that those efforts will improve revenue growth or margins.

Cisco’s valuation stood near 21 times forward earnings while revenue growth has been in the mid-single-digit range. Several analysts noted the gap between price and growth and urged caution that heavy option buying can reflect speculative positioning.

Call-option buying can amplify stock moves because dealers who sell those contracts often hedge by buying the underlying shares, which can push the price higher. Market participants pointed to that hedging dynamic and concentrated demand for bullish contracts as factors in the intraday jump.

Investors will watch Cisco’s revenue trends, margin outlook and management commentary when results are released, and they will monitor whether options-driven demand continues to affect price after the report.