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In the latest market close, IBM (IBM) reached $224.26, with a -0.24% movement compared to the previous day. This move lagged the S&P 500's daily gain of 0.88%. Elsewhere, the Dow gained 1.24%, while the tech-heavy Nasdaq added 0.65%.
Shares of the technology and consulting company witnessed a gain of 1.29% over the previous month, beating the performance of the Computer and Technology sector with its gain of 0.37% and the S&P 500's gain of 1.17%.
The upcoming earnings release of IBM will be of great interest to investors. The company's earnings report is expected on January 29, 2025. It is anticipated that the company will report an EPS of $3.74, marking a 3.36% fall compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $17.6 billion, reflecting a 1.25% rise from the equivalent quarter last year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for IBM. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. IBM presently features a Zacks Rank of #4 (Sell).
From a valuation perspective, IBM is currently exchanging hands at a Forward P/E ratio of 21.18. For comparison, its industry has an average Forward P/E of 18.3, which means IBM is trading at a premium to the group.
Also, we should mention that IBM has a PEG ratio of 4.81. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Integrated Systems industry had an average PEG ratio of 1.89 as trading concluded yesterday.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 151, placing it within the bottom 40% of over 250 industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.