IBM (IBM) Suffers a Larger Drop Than the General Market: Key Insights
IBM (IBM) ended the recent trading session at $188.79, demonstrating a -1.07% swing from the preceding day's closing price. This change lagged the S&P 500's 0.31% loss on the day. Meanwhile, the Dow experienced a drop of 0.41%, and the technology-dominated Nasdaq saw a decrease of 0.27%.
The technology and consulting company's shares have seen an increase of 2.76% over the last month, not keeping up with the Computer and Technology sector's gain of 3.86% and the S&P 500's gain of 3.05%.
Analysts and investors alike will be keeping a close eye on the performance of IBM in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.59, marking a 16.91% rise compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $14.56 billion, indicating a 2.18% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $10.07 per share and revenue of $63.79 billion, which would represent changes of +4.68% and +3.12%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for IBM. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.01% higher. At present, IBM boasts a Zacks Rank of #3 (Hold).
Looking at valuation, IBM is presently trading at a Forward P/E ratio of 18.96. This represents a premium compared to its industry's average Forward P/E of 17.25.
We can additionally observe that IBM currently boasts a PEG ratio of 3.74. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. IBM's industry had an average PEG ratio of 2.57 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 156, putting it in the bottom 39% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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International Business Machines Corporation (IBM) : Free Stock Analysis Report
