RESEARCH ALERT-Salomon cuts IBM to in-line Friday December 6, 5:59 am ET
LONDON, Dec 6 (Reuters) - Salomon Smith Barney said on Friday it had downgraded its rating on shares of International Business Machines (NYSE:IBM - News) to "in-line" from "outperform", citing valuation, but left unchanged its earnings estimates and share price target. ADVERTISEMENT
Salomon said in a research note the shares were trading near the historical peaks on price-to-sales and price-to-cash-flow. IBM shares have surged 51 percent since October 9, outperforming the Nasdaq and S&P 500 indices.
"While we are comfortable with our current estimates and consensus for 4Q 02 and 2003, we see little upside to these estimates, especially during the next three quarters," Salomon said.
"Shares of Hewlett-Packard (NYSE:HPQ - News) offer superior returns, in our view," Salomon added.