IBM's (IBM) Confluent Deal Expected to Boost EBITDA and Free Cash Flow

International Business Machines Corporation (NYSE:IBM) ranks among the best big data stocks to invest in.  On December 10, Bernstein SocGen Group maintained its Market Perform rating for International Business Machines Corporation (NYSE:IBM), with a $280 price target on the company’s shares. The rating follows IBM’s plans to buy all outstanding common shares of Confluent for $31 per share in cash, representing an enterprise value of roughly $11 billion.

According to analyst Mark C. Newman, the deal is likely to boost IBM’s adjusted EBITDA during the first full year of completion.

The purchase is also expected to boost IBM’s free cash flow in the second year after completion.

On the other hand, S&P Global Ratings lowered IBM’s outlook to negative, projecting that the acquisition will keep the company’s leverage at roughly 2.5x in fiscal 2026. However, the firm anticipates IBM’s revenue to increase by 6% in fiscal 2025 as a result of robust growth in the software and infrastructure areas following the launch of z17.

International Business Machines Corporation (NYSE:IBM) is a global technology leader providing software, consulting, and infrastructure solutions, with a​ strategic emphasis on hybrid cloud and artificial intelligence. The company is heavily involved in big data through its enterprise data and analytics portfolio, delivering essential platforms like IBM Db2, Netezza (data warehousing), and IBM Cloud Pak for Data.

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Disclosure: None. This article is originally published at Insider Monkey.