"IBM will fill the gap at $196... Short your heart out..."
Man I hope not.
I just got back in after letting it walk away.
But I'll stay put. IBM managed a 13% GAAP EPS advance in 2009 so I'm focused on about $17+ as a likely Operating EPS this year.IBM has managed to increase margins nicely since 2009.
I think I've lapsed back into autopilot again with IBM which was first interrupted in 2008. I don't intend to spend my dollars in IBM in the foreseeable future so I'm back to auto hold on the shares I have. By far my biggest mistake with IBM since 1997 was selling it. I've made just a little timing gain which has been vastly outweighed by cap gains forgone -- taken up on the wings of angles to money heaven.
It looks like ORCL's changing book of biz has crimped its revenue growth towards IBM's recent history, except ORCL doesn't have IBM Services business or IBM's Global Financial Services book of leases and installment sales which are two important pillars of IBM's model. Those operations make IBM a mud-er when growth slows such that it has been able to crank out EPS growth by cutting costs and changing revenue mix to increase margins. Grows slow but on the other hand IBM has not had to look back at a period since 2002 when it grossly overpaid buying its stock back like HPQ did when it bought back 17% 2006 - 2010 in the $50's trying to look like IBM. DELL has weak prospects and ORCL may have hardware blues for a long time
Speaking of buybacks, seems to me that IBM has a shot to go below 1 bil shares outstanding in 2015 at the current buyback run rate along with hitting the $20 boggy.