Summary
- IBM has shown strong technical indicators, including a 22.73% gain since 6/24, 100% technical buy signals, and a 46.56% gain in the last year.
- The company operates through Software, Consulting, Infrastructure, and Financing segments, offering hybrid cloud, AI platforms, and lifecycle services for hybrid cloud infrastructure..
- Analysts have mixed opinions: 5 strong buys, 2 buys, 10 holds, and 4 sells, with price targets ranging from $139 to $240..
- Despite strong technicals, some analysts see IBM as overvalued, with MorningStar rating it 1 star and noting it is 54% overvalued.
The Chart of the Day belongs to the information technology company International Business Machines (IBM) . I found the stock by using Barchart's powerful screening functions to find stocks with the highest technical buy signals, highest Weighted Alpha, superior current momentum and having a Trend Seeker buy signal then used the Flipchart feature to review the charts for consistent price appreciation. Since the Trend Seeker signaled a buy on 6/24 the stock gained 22.73%.
International Business Machines Corporation, together with its subsidiaries, provides integrated solutions and services worldwide. The company operates through Software, Consulting, Infrastructure, and Financing segments. The Software segment offers a hybrid cloud and AI platforms that allows clients to realize their digital and AI transformations across the applications, data, and environments in which they operate. The Consulting segment focuses on skills integration for strategy, experience, technology, and operations by domain and industry. The Infrastructure segment provides on-premises and cloud based server, and storage solutions, as well as life-cycle services for hybrid cloud infrastructure deployment. The Financing segment offers client and commercial financing, facilitates IBM clients' acquisition of hardware, software, and services. The company has a strategic partnership to various companies including hyperscalers, service providers, global system integrators, and software and hardware vendors that includes Adobe, Amazon Web services, Microsoft, Oracle, Salesforce, Samsung Electronics and SAP, and others. The company was formerly known as Computing-Tabulating-Recording Co. International Business Machines Corporation was incorporated in 1911 and is headquartered in Armonk, New York.
Barchart's Opinion Trading systems are listed below. Please note that the Barchart Opinion indicators are updated live during the session every 20 minutes and can therefore change during the day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report.
Barchart Technical Indicators:
- 100% technical buy signals
- 50.85+ Weighted Alpha
- .70 - 60 month Beta
- 46.56% gain in the last year
- Trend Seeker buy signal
- Above its 20, 50 and 100 day moving averages
- 17 new highs and up 12.46% in the last month
- Relative Strength Index 79.89%
- Technical support level at $212.58
- Recently traded at $214.79 with 50 day moving average of $192.30
Fundamental Factors:
- Market Cap $197 billion
- P/E 20.79
- Dividend yield 3.10%
- Revenue expected to grow 2.20% this year and another 4.80% next year
- Earnings are estimated to increase 5.70% this year, an additional 5.10% next year and continue to compound at an annual rate of 3.90% for the next 5 years
Analysts and Investor Sentiment -- I don't buy stocks because everyone else is buying but I do realize that if major firms and investors are dumping a stock it's hard to make money swimming against the tide:
- Wall Street analyst gave 5 strong buy, 2 buy, 10 hold and 4 sell opinions on the stock
- Analysts' price targets are between $139 and $240 with a consensus of $193
- Value Line give the stock its average rating of 3 and comments: "The elevated valuation limits the total-return potential over the long haul as well. Hence, subscribers should look elsewhere."
- CFRAs MarketScope rates the stock a 4 star buy with a price target of $215 and comments: "We think IBM’s combination of consulting and broad proprietary tech offerings addressing key secular trends (cloud migration, AI, etc.) is a unique value proposition. "
- MorningStar rates the stock a below average 1 star rating with Fair Value at $139 and says it is 54% over valued and comments:"Even IBM’s stickiest customers find it worth it to switch to IBM competitors in software and cloud offerings and, in turn, minimize the size of IBM’s IT services accounts."
- 398.555 investors monitor the stock on Seeking Alpha
Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance and reevaluate your stop losses at least on a weekly basis.
On the date of publication, Jim Van Meerten did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
