International Business Machines (NYSE:IBM) Sees Strong Trading Volume on Analyst Upgrade

Key Points

• IBM shares saw unusually heavy trading volume after Morgan Stanley raised its price target on the stock from $267 to $293, though the firm kept an equal-weight rating.
• Analyst sentiment remains mixed: IBM now has a MarketBeat average rating of “Moderate Buy” with a consensus price target of $307.17, but recent calls included both upgrades and downgrades from major firms.
• Recent business updates were negative overall, with IBM warning that preliminary Q2 EPS and revenue missed expectations due to delayed deal closures and shifting client spending, sparking a sharp selloff and pressuring peers like ServiceNow.

Shares of International Business Machines Corporation (NYSE:IBM - Get Free Report) saw unusually-strong trading volume on Tuesday after Morgan Stanley raised their price target on the stock from $267.00 to $293.00. Morgan Stanley currently has an equal weight rating on the stock. Approximately 16,909,111 shares traded hands during trading, an increase of 131% from the previous session's volume of 7,332,979 shares.The stock last traded at $219.9360 and had previously closed at $290.23.

A number of other equities analysts have also weighed in on IBM. BMO Capital Markets lowered their price target on International Business Machines from $290.00 to $270.00 and set a "market perform" rating on the stock in a report on Thursday, April 23rd. Royal Bank Of Canada reaffirmed an "outperform" rating on shares of International Business Machines in a research note on Tuesday, June 23rd. Susquehanna began coverage on shares of International Business Machines in a report on Friday. They issued a "neutral" rating and a $303.00 target price on the stock. JPMorgan Chase & Co. upgraded International Business Machines from a "neutral" rating to an "overweight" rating and boosted their price target for the company from $270.00 to $291.00 in a report on Tuesday, June 23rd. Finally, KeyCorp downgraded shares of International Business Machines to a "sector weight" rating in a research report on Tuesday, June 23rd. Fifteen investment analysts have rated the stock with a Buy rating, nine have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company presently has an average rating of "Moderate Buy" and an average price target of $307.17.

Key Headlines Impacting International Business Machines

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

• Negative Sentiment: IBM’s preliminary Q2 results came in below expectations, with both EPS and revenue missing estimates, triggering a steep selloff. Reuters: IBM expects second-quarter revenue below estimates
• Negative Sentiment: Management blamed the shortfall on delayed deal closures and shifting client spending, raising near-term concerns about execution and demand mix. CNBC: IBM shares drop more than 17% after company warns second-quarter earnings fell short of expectations
• Negative Sentiment: IBM’s warning is spilling over into peers such as ServiceNow, suggesting the miss may be interpreted as a broader sign of softer enterprise software spending. Benzinga: ServiceNow Stock Falls in Sympathy With IBM After Disappointing Preliminary Q2 Results
• Neutral Sentiment: Morgan Stanley raised its price target on IBM to $293, which signals some analyst confidence, though the firm kept an equal-weight rating. Benzinga/The Fly: IBM price target raised by Morgan Stanley

Institutional Trading of International Business Machines

Institutional investors have recently added to or reduced their stakes in the business. Brighton Jones LLC grew its stake in shares of International Business Machines by 12.4% in the fourth quarter. Brighton Jones LLC now owns 21,011 shares of the technology company's stock worth $4,619,000 after acquiring an additional 2,323 shares during the period. Sivia Capital Partners LLC raised its position in International Business Machines by 10.6% in the second quarter. Sivia Capital Partners LLC now owns 1,938 shares of the technology company's stock worth $571,000 after acquiring an additional 186 shares during the period. Jump Financial LLC bought a new position in International Business Machines in the 2nd quarter worth $211,000. Ieq Capital LLC lifted its position in shares of International Business Machines by 2.2% during the 2nd quarter. Ieq Capital LLC now owns 38,617 shares of the technology company's stock valued at $11,383,000 after buying an additional 843 shares in the last quarter. Finally, Vivaldi Capital Management LP boosted its position in shares of International Business Machines by 11.6% in the second quarter. Vivaldi Capital Management LP now owns 1,017 shares of the technology company's stock worth $300,000 after purchasing an additional 106 shares during the period. 58.96% of the stock is currently owned by hedge funds and other institutional investors.

International Business Machines Price Performance

The company has a debt-to-equity ratio of 1.75, a quick ratio of 0.76 and a current ratio of 0.80. The firm's fifty day moving average is $264.95 and its two-hundred day moving average is $265.82. The company has a market cap of $204.30 billion, a P/E ratio of 19.39, a P/E/G ratio of 2.78 and a beta of 0.68.

International Business Machines (NYSE:IBM - Get Free Report) last issued its earnings results on Wednesday, April 22nd. The technology company reported $1.91 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.81 by $0.10. International Business Machines had a return on equity of 37.23% and a net margin of 15.61%.The company had revenue of $15.92 billion for the quarter, compared to the consensus estimate of $15.60 billion. During the same quarter last year, the company earned $1.60 EPS. The firm's quarterly revenue was up 9.5% on a year-over-year basis. As a group, analysts anticipate that International Business Machines Corporation will post 12.45 earnings per share for the current fiscal year.

International Business Machines Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Wednesday, June 10th. Investors of record on Friday, May 8th were given a $1.69 dividend. This is an increase from International Business Machines's previous quarterly dividend of $1.68. This represents a $6.76 dividend on an annualized basis and a dividend yield of 3.1%. The ex-dividend date was Friday, May 8th. International Business Machines's dividend payout ratio (DPR) is presently 59.77%.

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.

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