In the latest trading session, IBM (IBM) closed at $291.35, marking a -4.68% move from the previous day. The stock trailed the S&P 500, which registered a daily loss of 2.06%. Elsewhere, the Dow lost 1.76%, while the tech-heavy Nasdaq lost 2.39%.
Coming into today, shares of the technology and consulting company had gained 0.95% in the past month. In that same time, the Computer and Technology sector gained 1.71%, while the S&P 500 gained 1.63%.
Market participants will be closely following the financial results of IBM in its upcoming release. The company plans to announce its earnings on January 28, 2026. The company's earnings per share (EPS) are projected to be $4.33, reflecting a 10.46% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $19.21 billion, indicating a 9.45% upward movement from the same quarter last year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $11.38 per share and a revenue of $67.06 billion, representing changes of +10.16% and 0%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for IBM. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.38% decrease. IBM currently has a Zacks Rank of #3 (Hold).
Digging into valuation, IBM currently has a Forward P/E ratio of 25.07. For comparison, its industry has an average Forward P/E of 24.1, which means IBM is trading at a premium to the group.
One should further note that IBM currently holds a PEG ratio of 2.96. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Computer - Integrated Systems industry stood at 1.09 at the close of the market yesterday.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 55, placing it within the top 23% of over 250 industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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International Business Machines Corporation (IBM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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