Cisco Systems is making headlines this week because of a recent acquisition. The company purchased OpenDNS in an all-cash acquisition valued at $635 million. Today, we'll talk about why Cisco Systems made the decision to acquire OpenDNS, what it means for their stock moving forward, and how you can capitalize off of the trends through trading binary options. So, let's get right to it…
Why Did Cisco Systems Acquire OpenDNS?
Cisco Systems is a networking giant. It's one of those companies that are essentially the glue that holds the “Internet of Things” together. OpenDNS ties right into that model. The company offers a suite of internet services that can improve the security of networks. The system replaces the network provider's DNS servers with OpenDNS servers. From there, the server excludes access to known hot spots for scams and viruses.
Cisco released a barrage of press materials announcing the acquisition and clearly disclosing that they plan to boost security. Here's a quote from these materials that sums it up pretty well…
“The acquisition will boost Cisco's Security Everywhere approach by adding broad visibility and threat intelligence from the OpenDNS cloud delivered platform…”
What This Means For Cisco Systems Moving Forward
This news is incredibly big for Cisco Systems moving forward. The reality here is that there is a new market emerging; the Internet of Things. This is the very fiber that connects devices and creates ecosystems of hardware that work together to obtain a higher level of efficiency. With that said, while it may be considered a relatively small market when you first hear about it; it's actually huge already and growing rapidly. According to Cisco Systems, the Internet of Things is a $19 trillion market in the making…that is absolutely massive. This acquisition shows that one of the leaders in the charge is taking aim at top spot by ensuring quality security in networks. This is likely to lead to growth for the company and its stock.
How To Profit From The Cisco Systems Acquisition Of OpenDNS?
If you plan to trade Cisco Systems binary options, simply follow the short guide below…
Short Term – In the short run, we're going to be looking for strong gains. Cisco Systems didn't get the reaction it deserved from the positive press as investors maintain concerns over the Greek Debt Crisis. However, I believe that the stock will reach support relatively soon; leading to big gains. So, we're going to be looking for a reversal, when one happens; call options should yield positive results.
Long Term – This is also great news for Cisco Systems in the long run. The reality is that the Internet of Things is a huge market; and this move makes Cisco a more attractive option. I think that will prove to be profitable in the long run from a fundamental standpoint. So, watch for dips and take advantage of the following gains with calls!
What Do You Think?
Where do you think Cisco Systems stock is headed and why? Let us know in the comments below.