As COVID-19 recedes, many companies are benefitting from rising retail and travel trends, as consumers leave their homes and spend money saved up during the previous year. One of those companies is tech giant International Business Machines Corporation (IBM). The company is expected to release its earnings report after-market close on Monday, July 19. (See IBM stock charts on TipRanks)
Covering the stock in his report, Amit Daryanani of Evercore ISI opined that the Q2 results should be a “solid quarter” for IBM. The five-star analyst wrote that IBM should benefit from “improved IT spending backdrop, easy year-over-year compare, and favorable setup (vs. Historical seasonality).”
Daryanani reiterated a Hold rating on the stock, and declared a price target of $150. This suggests a potential 12-month upside of 7.99%.
He was also highly encouraged by the switch in executive management, namely the new CEO and Chairman Arvind Krishna, who replaced Jim Whitehurst. The change is said to have brought “a new sense of optimism” to the age-old company.
“Initiatives like open door policy and office hours where employees can discuss anything/everything with Mr. Krishna coupled with his focus on software assets has created a sense of excitement and empowerment within the organization,” wrote Daryanani.
IBM has also spun-off a new company called Kyndryl from its IT infrastructure services branch. The future firm will be responsible for managing digital transformations for infrastructure services. Daryanani expects this new company to be highlighted throughout the earnings call.
On TipRanks, IBM has an analyst rating consensus of Moderate Buy, based on 4 Buy and 3 Hold ratings, and 1 Sell rating. The average IBM price target is $153, reflecting a possible 12-month upside of 10.15%. IBM closed trading Friday at a price of $138.90 per share.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.