Investment firm UBS Warburg Thursday downgraded Cisco stock, citing slowing orders and softness in U.S. and European enterprise markets.

The firm cut its revenue estimates for Cisco's fiscal fourth quarter, which ends in July, from 6 percent to 4 percent on a sequential basis and to 6 percent "organic" growth -- excluding acquisitions -- year over year.

"Our industry checks show orders are slowing, which gives us concern about the July quarter," states UBS analyst Nikos Theodosopoulos in his bulletin on the downgrade. "Recent checks indicate that in addition to prior softness in U.S. Enterprise, European Enterprise is slowing a bit, and Emerging Markets, while still strong, are growing in the 25 to 30 percent range, not the 30 to 40 percent target."

UBS also is lowering its fiscal 2008 and 2009 revenue growth estimates for Cisco. Estimates for 2008 are now 12.4 percent from 12.8 percent. For the following year, expectations have been lowered to 7.9 percent from 9.2 percent. Earnings-per-share estimates have been lowered by 1 cent for 2008 and 3 cents for 2009.

Cisco stated bullishly in recent quarters that it expects annual revenue growth in the 12 percent to 17 percent range, but CEO John Chambers warned that the third and fourth quarters of fiscal 2008 could be " extremely challenging." UBS now feels Cisco will need to make acquisitions to grow at that 12 percent to 17 percent clip.

"Historical analysis of $40 billion tech companies shows it's virtually impossible to grow 12 percent to 17 percent without requiring acquisitions and compromising operating margins," Theodosopoulos states. "We believe Cisco's aggressive target will require acquisitions. We think the stock will have a hard time rallying if demand is slowing and acquisitions are likely."