https://www.barrons.com/articles/buy-ibm-stock-pick-barrons-51640631478
15 replies (most recent on top)
You can see the stock popping up in the last few weeks... just wait for the earnings call and the stock price will reset down at least $20. If you own the IBM stock and made some money, sell before the earnings call and go short.
Turnaround and what? Kiss their @$$ goodbye?
I pity the fool who buys IBM!
Pity the fools who invest in ibm shares. Same turn around story was peddled over last 10 years.
Stock prices going up is not the same as a real turnaround. Please refer to Ginni Rometty years (and the same games are still being played today).
Bank of India is the IBM of the financial sector.
These "analysts" have no idea about tech industry. Arvind is just another ibm svp, sure he's better than Ginni but nowhere close to Satya. Satya is considered as one of the greatest right now in tech industry, even better than Googles ceo.
They don't realize that ibm has NOTHING which separates themselves from others except for their mainframe business but that has no growth component to it for most part, well not like the cloud growth that aws, Ms, goog are having right now. It's a cyclical with some growth.
These naive analysts should atleast be able to look at ibm's dividend because of which it cannot even invest properly in r&d and have to buy small companies. Just look at how many were bought this year.
Ibm can't even compete with small startups in new software let alone with MS or Fangs who'll spend way more than ibm at new technologies because their r&d budgets are huge.
An engineer at ibm can easily double or even 3x their salary moving to these companies. Seriously, IBM is DONE.
BofA and Barrons have been IBM mistresses for over 20 years so no surprise on the sources. You can't believe a word that comes out of all 3
Barron's is the IBM of the publication industry.
IBM has certainly gotten rid of 2/3’s of their burden (GTS). There is yet another 1/3 to go from the original IBM size. (approx 45-50k heads) The goal is to rightsize IBM via revenue per employee (approx 300-325k) The Redhat purchase was a long term leap of faith. Redhat has to provide growth, in addition to the shrink of the legacy divisions (best case 1-2 billion) Also note they have to service the debt of approx 1 billion a year for its purchase. That is quite a tall order for a 4 billion dollar (now 5 billion in revenue) company. At best IBM is currently just treading water, BUT if the legacy customers buy into the application modernization/AI (especially using Redhat) that would be a new go to market strategy thus an avenue of new growth. Will it work? We’ll know the answer by the end of 2022. In the mean time expect IBM to continue to restructure the remaining 1/3 of old IBM that is budgeted. They have to service that Redhat debt, and cost reductions while they still have the legacy cash flow is the prudent way to maximize debt servicing while waiting for the new strategy to gain some traction.
There is no more ibm cloud. It’s software now.
Not a chance. Microsoft turned around from a much better base, and with an actual cloud business to generate revenue. Where is the IBM Cloud? Even IBM have stopped marketing it in favor of partnerships. Red Hat is a great set of technologies but nowhere near enough to offset the rest of IBM, and without anything like the growth potential of what was paid.
[Quoting entire article below]
By: Andrew Bary
Jan. 1, 2022 3:00 am ET
This article is an excerpt from Barron’s 10 favorite stocks for 2022, published on Dec. 17. To see the full list, click here.
IBM could be one of the big turnaround stories of 2022. Barron’s highlighted the company’s improving outlook in a recent cover story, calling it “ Microsoft Jr.”
Under CEO Arvind Krishna, IBM (ticker: IBM) has spun off a pedestrian business of managing data centers into Kyndryl Holdings (KD), refocused on the cloud and artificial intelligence, and vowed to start growing again for the first time in about a decade.
Wall Street is skeptical about IBM’s prospects, but one bull, BofA Global Research’s Wamsi Mohan, has compared Krishna to Satya Nadella, the Microsoft CEO who transformed the company over the past seven years.
IBM, whose shares trade around $126, is valued at 11 times projected 2022 earnings. And it has the highest dividend yield in the Dow Jones Industrial Average, at 5.3%.
If Krishna is successful in boosting sales and margins while making IBM relevant again, there could be a lot of upside in a largely forgotten stock.
IBM has been trying to turn around for 20+ years. We're all dizzy with anticipation.
Yeah. Only if Redhat can carry the weight of the IBM anchor.