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IBM

International Business Machines (IBM)

$264.74

Delayed price

Today’s top pick

Profit since last BUY17.19%

Strong Buy

BUY since 55 days

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Upturn Advisory Summary

02/20/2025: IBM (5-star) is a STRONG-BUY. BUY since 55 days. Profits (17.19%). Updated daily EoD!

Upturn Star Rating

Outstanding Performance

These Stocks/ETFs, based on Upturn Advisory, have historically outperformed the market, making them a top-tier choice for investors.

AI Based Fundamental Rating

Above Average Performance

These Stocks/ETFs, based on Upturn Advisory, frequently surpass the market, reflecting reliable and trustworthy advice.

Analysis of Past Performance

Type Stock

Historic Profit 74.27%

Avg. Invested days 55

Today’s Advisory Strong Buy

Upturn Star Rating

Upturn Advisory Performance

4.0

Stock Returns Performance

4.0

Profits based on simulation

Last Close 02/20/2025

Key Highlights

Company Size Large-Cap Stock	Market Capitalization 244.79B USD	Price to earnings Ratio 41.24	1Y Target Price 254.51
Price to earnings Ratio 41.24	1Y Target Price 254.51
Volume (30-day avg) 4867800	Beta 0.75	52 Weeks Range 157.33 - 265.09	Updated Date 02/20/2025
52 Weeks Range 157.33 - 265.09	Updated Date 02/20/2025
Dividends yield (FY) 2.53%	Basic EPS (TTM) 6.42

Revenue by Products

Product revenue - Year on Year

Revenue by Geography

Geography revenue - Year on Year

Earnings Date

Report Date 2025-01-29

When After Market

Estimate 3.77

Actual 3.92

Profitability

Profit Margin 9.6%

Operating Margin (TTM) 21.88%

Management Effectiveness

Return on Assets (TTM) 4.15%

Return on Equity (TTM) 24.06%

Valuation

Trailing PE 41.24	Forward PE 24.27	Enterprise Value 288207206576	Price to Sales(TTM) 3.9
Enterprise Value 288207206576	Price to Sales(TTM) 3.9
Enterprise Value to Revenue 4.59	Enterprise Value to EBITDA 23.67	Shares Outstanding 924644992	Shares Floating 923953540
Shares Outstanding 924644992	Shares Floating 923953540
Percent Insiders 0.47	Percent Institutions 64.3

AI Summary

International Business Machines (IBM) Analysis:

Company Profile:

History and Background:

Founded in 1911 as the Computing-Tabulating-Recording Company (CTR).
Renamed International Business Machines in 1924.
Played a pivotal role in the development of computers, mainframes, and personal computers.
Pioneered technologies like the floppy disk, magnetic stripe card, and relational databases.
Faced challenges in the 1990s with the rise of personal computers and the internet.
Shifted focus to software and services in the 21st century.

Core Business Areas:

Cloud and Cognitive Software: Offering cloud computing solutions, AI, and data analytics services.
Global Technology Services: Providing IT infrastructure management, business process outsourcing, and security services.
Systems: Developing and selling mainframe computers and high-performance servers.
Global Financing: Offering financing solutions for technology acquisition and investments.

Leadership and Corporate Structure:

CEO: Arvind Krishna
CFO: James Kavanaugh
President: Martin Schroeter
Board of Directors: Comprised of 14 members with diverse industry experience.
Organizational Structure: Segmented into five business segments based on product and service offerings.

Top Products and Market Share:

Products:

IBM Cloud: A comprehensive cloud computing platform offering infrastructure, platform, and software services.
Watson AI: A suite of AI tools for natural language processing, machine learning, and computer vision.
Red Hat OpenShift: A container platform for building and deploying cloud-native applications.
Z and LinuxONE Systems: High-performance mainframe computers for mission-critical workloads.
Global Technology Services: A portfolio of IT infrastructure management, business process outsourcing, and security services.

Market Share:

Cloud Computing: 4.5% global market share (as of Q2 2023).
AI Software: 9.4% global market share (as of 2022).
Mainframe Computers: 74% global market share (as of 2022).

Competitive Landscape:

Key Competitors:

Cloud Computing: Amazon Web Services, Microsoft Azure, Google Cloud Platform.
AI Software: Microsoft, Google, Salesforce.
Mainframe Computers: Unisys, Fujitsu.

Market Dynamics:

Cloud computing market is growing rapidly, with major players competing fiercely for market share.
AI adoption is accelerating across industries, driving demand for advanced AI solutions.
Mainframe market is mature, with a focus on modernization and efficiency.

Total Addressable Market:

Global cloud computing market: $371.4 billion (2022).
Global AI software market: $126.0 billion (2022).
Global mainframe market: $15 billion (2022).

Financial Performance:

Recent Financial Statements:

Revenue: $57.35 billion (2022).
Net Income: $5.5 billion (2022).
Profit Margin: 9.6% (2022).
EPS: $5.68 (2022).

Year-over-Year Performance:

Revenue growth: 5.9% (2022).
Net income growth: 19.3% (2022).
EPS growth: 15.8% (2022).

Cash Flow and Balance Sheet:

Strong cash flow generation.
Healthy balance sheet with low debt levels.

Dividends and Shareholder Returns:

Dividend History:

IBM has a long history of dividend payments.
Current dividend yield: 4.8%.
Payout ratio: 60%.

Shareholder Returns:

1-year total return: 2.7%.
5-year total return: 45.9%.
10-year total return: 72.5%.

Growth Trajectory:

Historical Growth:

Revenue growth has been modest in recent years.
EPS growth has been stronger, driven by share buybacks.

Future Growth Projections:

Cloud computing and AI are expected to drive future growth.
Management projects mid-single-digit revenue growth in the coming years.

Recent Initiatives:

Expanding cloud computing and AI offerings.
Investing in R&D for emerging technologies like quantum computing.
Pursuing strategic acquisitions and partnerships.

Key Challenges:

Intense competition in cloud computing and AI markets.
Maintaining profitability in a commoditized mainframe market.
Keeping pace with rapid technological advancements.

Potential Opportunities:

Expanding into new markets and industries.
Developing innovative AI-powered solutions.
Growing cloud computing and hybrid cloud capabilities.

Recent Acquisitions:

2022: Neudesic, a cloud-based IT consulting firm.
2021: Turbonomic, a cloud management software company.
2020: BoxBoat, a developer of data lake governance software.

AI-Based Fundamental Rating:

Rating: 7/10
Justification: IBM has a strong financial position, diverse business portfolio, and a leading position in several attractive markets. However, the company faces challenges from competition and needs to execute on its growth strategy.

Sources:

IBM Annual Report 2022
IBM Investor Relations website
Yahoo Finance
Gartner

About International Business Machines

Exchange NYSE	Headquaters Armonk, NY, United States
IPO Launch date 1962-01-02	CEO, President & Chairman Mr. Arvind Krishna
Sector Technology	Industry Information Technology Services	Full time employees -	Website https://www.ibm.com
Full time employees -	Website https://www.ibm.com

International Business Machines Corporation, together with its subsidiaries, provides integrated solutions and services worldwide. The company operates through Software, Consulting, Infrastructure, and Financing segments. The Software segment offers a hybrid cloud and AI platforms that allows clients to realize their digital and AI transformations across the applications, data, and environments in which they operate. The Consulting segment focuses on skills integration for strategy, experience, technology, and operations by domain and industry. The Infrastructure segment provides on-premises and cloud based server, and storage solutions, as well as life-cycle services for hybrid cloud infrastructure deployment. The Financing segment offers client and commercial financing, facilitates IBM clients' acquisition of hardware, software, and services. The company has a strategic partnership to various companies including hyperscalers, service providers, global system integrators, and software and hardware vendors that includes Adobe, Amazon Web services, Microsoft, Oracle, Salesforce, Samsung Electronics and SAP, and others. The company was formerly known as Computing-Tabulating-Recording Co. International Business Machines Corporation was incorporated in 1911 and is headquartered in Armonk, New York.

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