Can anyone derive that from Q1/12 and 2011 numbers? I subtracted Q1 2011 from 2011 totals and added Q1 2012 and I can't come up with $13.41 for either GAAP EPS or Operating EPS. I get $13.36 for GAAP EPS q2 2011 thru 2012 Q1 and $13.81 for Operating EPS for the same period -- using numbers from IBM.
It looks like wall street is just looking at non GAAP Operating EPS as it approximates free cash flow per share for IBM -- it's now the only analyst estimate number in the composite analyst estimate page.. So the right denominator to use in p/e is $13.81 for historical p/e. At $204 Yahoo would show a p/e of 15.25 while using the actual ttm Operating EPS of $13.81 the historical p/e is 14.77. And if you're a believer that IBM will grow Op EPS at 15% for this year as it did in Q1, then Op EPS will come in at $15.45 this year and at $204 IBM is trading at 13.2x this years EPS.
In my book IBM is still a buy for conservative investors who are looking for cap gains and nice downside protection.
Yes! IBM will grow EPS at 15% as it has in recent years. They guided to more than $15 in 2012 which will be raised by the end of the year to $15.30-$15.40. If they continue to grow at 15% the next three years, then IBM will earn well over $20 by 2015. In fact, I would bet they reach their goal of $20 in earnings by 2014.
There is not much thinking to be done here. Just sit back, relax and watch IBM return value to shareholders.
Well, I'll be the first to admit, its way over my head, so I'm one of those that will just sit back and enjoy the ride. But that being said I am impressed with those of you that understand the numbers.