IBM (IBM) Increases Despite Market Slip: Here's What You Need to Know

IBM (IBM) closed at $166.96 in the latest trading session, marking a +0.7% move from the prior day. The stock exceeded the S&P 500, which registered a loss of 0.37% for the day. Elsewhere, the Dow saw a downswing of 0.62%, while the tech-heavy Nasdaq depreciated by 0.19%.

Prior to today's trading, shares of the technology and consulting company had gained 1.88% over the past month. This has outpaced the Computer and Technology sector's gain of 1.22% and the S&P 500's gain of 1.56% in that time.

The investment community will be paying close attention to the earnings performance of IBM in its upcoming release. The company is slated to reveal its earnings on January 24, 2024. The company is expected to report EPS of $3.74, up 3.89% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.12 billion, up 2.55% from the year-ago period.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for IBM. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been a 0.21% rise in the Zacks Consensus EPS estimate. IBM currently has a Zacks Rank of #3 (Hold).

From a valuation perspective, IBM is currently exchanging hands at a Forward P/E ratio of 16.93. This indicates a premium in contrast to its industry's Forward P/E of 16.38.

Investors should also note that IBM has a PEG ratio of 4.36 right now. 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. By the end of yesterday's trading, the Computer - Integrated Systems industry had an average PEG ratio of 2.54.

The Computer - Integrated Systems industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 168, finds itself in the bottom 34% echelons of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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