IBM Stock Gets Increased EPS Forecast from Erste Group Bank

Key Points

• Erste Group Bank raised IBM’s FY2026 EPS forecast to $12.30 from $12.27, though it remains slightly below the $12.41 analyst consensus.
• IBM recently reported quarterly EPS of $2.95, beating expectations of $2.85, while revenue rose 4.7% year over year to $17.10 billion.
• Analyst sentiment remains positive, with the stock carrying a “Moderate Buy” consensus rating and an average price target of $266.12; IBM also declared a quarterly dividend of $1.69 per share, yielding about 2.7% annually.

International Business Machines Corporation (NYSE:IBM - Free Report) - Erste Group Bank raised their FY2026 earnings per share (EPS) estimates for International Business Machines in a note issued to investors on Wednesday, October 21st. Erste Group Bank analyst H. Engel now forecasts that the technology company will post earnings per share of $12.30 for the year, up from their prior forecast of $12.27. The consensus estimate for International Business Machines' current full-year earnings is $12.41 per share.

Several other brokerages also recently commented on IBM. Truist Financial set a $260.00 price objective on International Business Machines in a research report on Thursday. The Goldman Sachs Group reiterated a "buy" rating and set a $300.00 target price on shares of International Business Machines in a research report on Thursday. Bank of America decreased their target price on International Business Machines from $330.00 to $280.00 and set a "buy" rating for the company in a research report on Wednesday, July 15th. Yorkville Ives initiated coverage on shares of International Business Machines in a research note on Monday, October 5th. They set an "outperform" rating and a $275.00 target price for the company. Finally, BMO Capital Markets upped their price target on shares of International Business Machines from $230.00 to $265.00 and gave the stock a "market perform" rating in a report on Thursday. Twenty analysts have rated the stock with a Buy rating, twelve have assigned a Hold rating and two have assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average target price of $266.12.

International Business Machines Price Performance

International Business Machines stock opened at $253.69 on Monday. International Business Machines has a 12-month low of $199.19 and a 12-month high of $332.46. The company has a current ratio of 0.85, a quick ratio of 0.80 and a debt-to-equity ratio of 1.57. The firm has a 50-day moving average price of $233.06 and a 200-day moving average price of $243.68. The firm has a market capitalization of $239.77 billion, a PE ratio of 21.63, a price-to-earnings-growth ratio of 2.50 and a beta of 0.73.

International Business Machines (NYSE:IBM - Get Free Report) last issued its quarterly earnings data on Wednesday, October 21st. The technology company reported $2.95 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.85 by $0.10. International Business Machines had a return on equity of 34.37% and a net margin of 15.99%. The business had revenue of $17.10 billion for the quarter, compared to analysts' expectations of $16.82 billion. During the same period in the prior year, the firm earned $2.65 EPS. The company's revenue for the quarter was up 4.7% on a year-over-year basis.

International Business Machines Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Thursday, December 10th. Investors of record on Tuesday, November 10th will be given a dividend of $1.69 per share. The ex-dividend date of this dividend is Tuesday, November 10th. This represents a $6.76 dividend on an annualized basis and a yield of 2.7%. International Business Machines's dividend payout ratio is presently 57.63%.

Insider Buying and Selling

In other news, SVP Robert Thomas sold 25,000 shares of the stock in a transaction on Wednesday, August 26th. The stock was sold at an average price of $230.32, for a total transaction of $5,758,000.00. Following the completion of the sale, the senior vice president owned 47,800 shares in the company, valued at approximately $11,009,296. This represents a 34.34% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. 0.27% of the stock is owned by insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Harborfront Financial Group LLC acquired a new stake in International Business Machines during the second quarter valued at $27,000. Hara Capital LLC acquired a new position in shares of International Business Machines in the second quarter worth about $28,000. Bare Financial Services Inc raised its position in shares of International Business Machines by 114.6% in the second quarter. Bare Financial Services Inc now owns 103 shares of the technology company's stock worth $29,000 after acquiring an additional 55 shares during the period. Portus Wealth Advisors LLC acquired a new position in shares of International Business Machines in the first quarter worth about $26,000. Finally, Caitlin John LLC purchased a new stake in shares of International Business Machines during the 2nd quarter worth about $35,000. Hedge funds and other institutional investors own 58.96% of the company's stock.

Key Stories Impacting International Business Machines

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

• Positive Sentiment: IBM reported third-quarter revenue of $17.1 billion, up 4.7% year over year, while adjusted EPS of $2.95 exceeded analyst expectations. Software growth accelerated to 9% at constant currency, infrastructure demand improved, and operating pretax margins expanded by 70 basis points. IBM Beats Q3 Earnings Estimates on Software, Infrastructure Growth
• Positive Sentiment: Management raised its full-year free-cash-flow outlook, supported by stronger software performance, Red Hat demand and enterprise AI activity. Transaction-processing revenue also rose 10%, suggesting improving demand in key recurring-revenue businesses. IBM: 3 Key Takeaways for Long-Term Investors
• Positive Sentiment: Several analysts raised their earnings estimates or price targets following the results. Erste Group increased its FY2027 EPS forecast to $13.40 from $13.13, while JPMorgan, RBC and Stifel reiterated positive ratings and lifted targets. IBM Analyst Estimates and Ratings
• Neutral Sentiment: IBM’s updated FY2026 revenue guidance of $70.2 billion to $70.9 billion broadly brackets the $70.4 billion consensus estimate. The outlook was not meaningfully raised, leaving investors focused on whether the software rebound can continue.
• Neutral Sentiment: IBM declared a quarterly dividend of $1.69 per share, or $6.76 annualized, reinforcing its appeal to income-oriented investors. A separate dividend-stock article highlighted IBM’s decades-long record of payout increases. IBM Declares $1.69 Dividend
• Negative Sentiment: Investors remain concerned that roughly half of the software growth benefited from the Confluent acquisition and that management’s unchanged revenue outlook implies slower growth later in the year. IBM’s comments that lower-cost, open-weight AI models can deliver comparable performance also raised questions about pricing power and AI monetization. Why Isn’t IBM’s Stock Bouncing Back After Strong Earnings Results?
• Negative Sentiment: Some analysts view IBM’s valuation as demanding relative to its modest underlying growth, while slower Consulting performance, debt and uncertainty over the durability of the software rebound could limit further upside.

About International Business Machines

International Business Machines Corporation NYSE: IBM, commonly known as IBM, is a global technology and consulting company that helps organizations modernize their information technology and business operations. Its offerings include hybrid cloud solutions, artificial intelligence software and services, enterprise software, IT infrastructure, cybersecurity, data analytics, and technology consulting.

IBM provides products and services to businesses, governments, and other institutions across industries and regions worldwide.

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