IBM, Maersk Partner to Bring Blockchain-Based Trade Platform
To extend its primacy in blockchain technology, International Business Machines Corporation IBM is joining forces with the largest container shipping firm in the world, A.P. Moller-Maersk. The partnership is intended to deliver a secure and efficient industry-wide trading platform using blockchain technology.
IBM and Maersk will use blockchain technology to power this new platform, as well as artificial intelligence (AI), IoT and analytics imperative delivered through IBM Services. Primarily aimed at cost cutting and speeding up trade, the platform will address the need to provide more transparency and simplicity in tracking shipments across borders and trading zones.
Further, this platform will deliver much needed innovation in the ocean shipping industry and aid IBM in branching out its foothold in this space.
Per market data, goods worth more than $4 trillion dollars are shipped each year, of which 80% are transported by the ocean shipping industry. Offering this platform for use to the global shipping industry will boost IBM’s top-line.
International Business Machines Corporation Revenue (TTM)
International Business Machines Corporation Revenue (TTM) | International Business Machines Corporation Quote
What is Blockchain?
Blockchain is the technology that allows cryptocurrencies to exist as it tracks transactions relating to digital assets. But it can also track documents which make it especially attractive to those in the banking, finance and insurance industries.
Blockchain technology is projected to reach $2.3 billion by 2021 from $210.2 million in 2016 at a CAGR of 61.5%, per data from MarketsandMarkets.
IBM’s Blockchain Initiatives
IBM is currently a dominant player in the blockchain market, which is touted as the next game-changer in the technology sector.
IBM is involved in a number of blockchain initiatives as the technology gains rapid mainstream adoption. Recently, CNBC quoted Juniper Research, which placed IBM above Microsoft Corporation in blockchain-related advancements.
The company has been an early adopter of the blockchain technology and has already worked with more than 400 clients to implement blockchain applications. It has struck bank guarantee deals with ANZ and Westpac as well as a multi-line insurance contract with American International Group and Standard Chartered PLC.
Moreover, IBM uses Hyperledger technology for blockchain applications and is also a key member of the Hyperledger committee. This enables the company to gain prior notification of any changes in the underlying infrastructure, which is the main reason behind its increasing deal wins.
Per a market research report published by Orbisresearch.com, blockchain technology is anticipated to be used by 65% of enterprises by 2020. Given its market presence and growing collaborations with industry leaders, IBM is well positioned to reap the benefits.
Zacks Rank and Stocks to Consider
IBM carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the broader technology sector are Broadcom Limited AVGO, Analog Devices, Inc. ADI and Mellanox Technologies, Ltd. MLNX, all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Broadcom, Analog Devices and Mellanox have a long-term expected earnings growth rate of 13.75%, 10.40% and 16% respectively.
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