International Business Machines (NYSE:IBM) Shares Gap Up – Should You Buy?

International Business Machines Corporation (NYSE:IBM)’s stock price gapped up before the market opened on Monday . The stock had previously closed at $297.80, but opened at $322.55. International Business Machines shares last traded at $311.3990, with a volume of 9,210,410 shares.

Key Stories Impacting International Business Machines

Here are the key news stories impacting International Business Machines this week:

• Positive Sentiment: IBM shares are getting a boost from fresh investor enthusiasm around its quantum computing push, with multiple reports highlighting the company’s large-scale investment plans and positioning as a long-term leader in next-generation computing.
• Positive Sentiment: Sentiment in the broader software group improved after Nvidia CEO Jensen Huang eased fears that AI will severely disrupt software businesses, helping lift IBM along with other enterprise software names.
• Positive Sentiment: Analysts and market commentary have also turned more constructive, pointing to IBM’s scale, cash flow, dividend appeal, and potential federal support for quantum-related initiatives as reasons the stock could have more upside.
• Neutral Sentiment: Recent articles also compared IBM’s performance with other cloud and SaaS peers, reinforcing that the stock has outperformed many software names but without adding a clear new catalyst.
• Neutral Sentiment: Quiver data showed mixed institutional activity and some congressional trading in IBM, which may matter to sentiment but is not a direct operating catalyst.

Analysts Set New Price Targets

Several equities research analysts have recently weighed in on IBM shares. BMO Capital Markets cut their target price on International Business Machines from $290.00 to $270.00 and set a “market perform” rating on the stock in a research report on Thursday, April 23rd. UBS Group upgraded shares of International Business Machines from a “sell” rating to a “neutral” rating and set a $236.00 price target on the stock in a research note on Wednesday, February 25th. HSBC raised shares of International Business Machines from a “reduce” rating to a “hold” rating and raised their price objective for the stock from $218.00 to $231.00 in a report on Tuesday, April 28th. Royal Bank Of Canada restated an “outperform” rating on shares of International Business Machines in a report on Thursday. Finally, Oppenheimer dropped their target price on shares of International Business Machines from $380.00 to $320.00 and set an “outperform” rating on the stock in a research report on Thursday, April 16th. One investment analyst has rated the stock with a Strong Buy rating, twelve have issued a Buy rating and eight have issued a Hold rating to the company’s stock. According to MarketBeat, the company presently has a consensus rating of “Moderate Buy” and a consensus price target of $297.50.

International Business Machines Stock Performance

The company has a quick ratio of 0.76, a current ratio of 0.80 and a debt-to-equity ratio of 1.75. The firm has a 50-day simple moving average of $240.16 and a 200 day simple moving average of $270.71. The company has a market cap of $300.32 billion, a price-to-earnings ratio of 28.25, a price-to-earnings-growth ratio of 3.08 and a beta of 0.66.

International Business Machines (NYSE:IBM) last posted its quarterly earnings data on Wednesday, April 22nd. The technology company reported $1.91 earnings per share for the quarter, beating the consensus estimate of $1.81 by $0.10. The business had revenue of $15.92 billion during the quarter, compared to the consensus estimate of $15.60 billion. International Business Machines had a return on equity of 37.23% and a net margin of 15.61%.The company’s revenue was up 9.5% compared to the same quarter last year. During the same period in the prior year, the company earned $1.60 earnings per share. On average, sell-side analysts predict that International Business Machines Corporation will post 12.4 earnings per share for the current fiscal year.

International Business Machines Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, June 10th. Shareholders of record on Friday, May 8th will be given a dividend of $1.69 per share. This represents a $6.76 annualized dividend and a yield of 2.1%. The ex-dividend date of this dividend is Friday, May 8th. This is an increase from International Business Machines’s previous quarterly dividend of $1.68. International Business Machines’s payout ratio is 59.77%.

Institutional Investors Weigh In On International Business Machines

A number of institutional investors and hedge funds have recently made changes to their positions in IBM. Blue Fin Capital Inc. boosted its stake in shares of International Business Machines by 10.0% during the first quarter. Blue Fin Capital Inc. now owns 1,101 shares of the technology company’s stock worth $267,000 after buying an additional 100 shares during the period. Security Financial Services INC. raised its stake in International Business Machines by 2.4% during the 1st quarter. Security Financial Services INC. now owns 2,393 shares of the technology company’s stock valued at $580,000 after acquiring an additional 57 shares during the last quarter. Summit Financial Wealth Advisors LLC raised its stake in International Business Machines by 7.8% during the 1st quarter. Summit Financial Wealth Advisors LLC now owns 20,300 shares of the technology company’s stock valued at $4,921,000 after acquiring an additional 1,471 shares during the last quarter. Axiom Investment Management LLC acquired a new stake in International Business Machines during the 1st quarter worth approximately $36,000. Finally, Summitry LLC grew its stake in shares of International Business Machines by 2.1% in the 1st quarter. Summitry LLC now owns 2,571 shares of the technology company’s stock valued at $623,000 after purchasing an additional 54 shares during the last quarter. 58.96% of the stock is owned by hedge funds and other institutional investors.

About International Business Machines

International Business Machines Corporation (IBM) is a global technology and consulting company headquartered in Armonk, New York. Founded in 1911 as the Computing-Tabulating-Recording Company (CTR) and renamed IBM in 1924, the company has evolved from early electromechanical machines to a diversified technology provider serving enterprises and governments worldwide. IBM is publicly traded on the New York Stock Exchange under the ticker symbol IBM.

IBM’s principal businesses encompass cloud computing and software, infrastructure and systems, consulting and technology services, and research and development.