In the latest close session, IBM (IBM) was up +1.88% at $242.01. The stock outperformed the S&P 500, which registered a daily loss of 0.54%. On the other hand, the Dow registered a gain of 0.03%, and the technology-centric Nasdaq decreased by 1.18%.
Shares of the technology and consulting company witnessed a loss of 19.25% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 0.82%, and the S&P 500's gain of 0.58%.
The investment community will be paying close attention to the earnings performance of IBM in its upcoming release. The company is forecasted to report an EPS of $1.78, showcasing a 11.25% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $15.56 billion, up 7.04% from the year-ago period.
For the annual period, the Zacks Consensus Estimates anticipate earnings of $12.37 per share and a revenue of $71.25 billion, signifying shifts of +6.73% and +5.5%, respectively, from the last year.
Any recent changes to analyst estimates for IBM should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.41% higher within the past month. At present, IBM boasts a Zacks Rank of #3 (Hold).
In the context of valuation, IBM is at present trading with a Forward P/E ratio of 19.21. This represents a discount compared to its industry average Forward P/E of 22.8.
It's also important to note that IBM currently trades at a PEG ratio of 2.38. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Computer - Integrated Systems was holding an average PEG ratio of 0.88 at yesterday's closing price.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 19, finds itself in the top 8% echelons of all 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.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming 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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