International Business Machines (IBM -1.00%) stock surged 14% higher following its fourth-quarter and 2024 earnings report. Under CEO Arvind Krishna, the company has redefined itself as primarily a hybrid cloud and artificial intelligence (AI) company, and his leadership reversed what had been a long-term decline in the stock.Consequently, the stock price has risen by around 35% over the last year. Now, investors must assess whether the stock remains a buy with a higher earnings multiple and lower dividend ...

It's been a long road for International Business Machines (IBM -1.00%) investors. The company kicked off a transformation effort more than a decade ago, forced to adapt to a tech industry that was rapidly embracing cloud computing. Years of inconsistent results followed as the company exited businesses and spent many billions of dollars on acquisitions.Some initiatives, like the company's early efforts to apply artificial intelligence (AI) technology to healthcare, were abject failures. Others, like the acq ...

International Business Machines (IBM -1.00%) has found an artificial intelligence (AI) strategy that works. While the tech giant is an AI pioneer, monetizing the technology has been a challenge over the past decade. The company's most notable failure was an attempt to leverage AI to transform the healthcare industry. After spending billions on acquisitions to fuel the effort, IBM eventually abandoned the business a few years ago with little to show for it.Today, IBM has settled into a role of enabling other ...

International Business Machines (IBM) was the star performer in Thursday's trading session as its shares rallied 13% to hit a new all-time high following robust fourth-quarter 2024 results. The company beat estimates on both earnings and revenues, driven by the strength of its AI business. See the Zacks Earnings Calendar to stay ahead of market-making news.Investors seeking to ride the rally should focus on ETFs with the highest allocation to this tech giant. These funds are FT Vest DJIA Dogs 10 Target Inco ...

IBM (NYSE: IBM) stock surged nearly 13% on January 30, marking its best single-day gain in over a decade.The rally followed a strong fourth-quarter earnings report, which highlighted robust revenue growth and a significant increase in AI-related bookings.IBM one-day price chart. Source: Google FinanceThe stock closed at an all-time high of $258.27 on January 30, extending its year-to-date gains to 17%, outperforming the S&P 500’s 3% rise over the same period. Strong Q4 results beat expectationsIBM’s Q4 earn ...

Telefonica, S.A. (TEF) recently inked an agreement with International Business Machines Corporation (IBM) to engineer robust security solutions that safeguard businesses and public institutions from the risks of a post-quantum world.The rise of quantum computing promises unprecedented computational power, enabling more advanced calculations. However, it presents a significant challenge: safeguarding data security in a world where conventional encryption methods may become obsolete. Although cryptographicall ...

Earnings and AI Business Growth - IBM shares surged 12% to $256 after posting better-than-expected Q4 earnings, driven by strong performance in its AI business [2] - The company's generative AI book of business grew by nearly $2 billion from the previous quarter, reflecting global client demand for AI-driven enterprise solutions [3] - IBM's software segment revenue increased by 10.4% YoY, marking its largest jump in five years, offsetting weaker performance in consulting and infrastructure [3] Stock Performance and Technical Analysis - IBM shares hit a record high near $262 and have gained 36% over the past year, outperforming the S&P 500 [4] - The stock is poised for a breakaway gap above the top trendline of an ascending triangle pattern, indicating bullish momentum [5][10] - Technical analysis suggests two upside price targets: $278 based on the measuring principle and $305 using bars pattern analysis, with the uptrend potentially lasting until May [7][9][10] Key Support Level - Investors should monitor the $238 level as a key support area, which may attract buying interest during pullbacks and could transition from resistance to support [10][11]

Core Viewpoint - IBM's stock price increased significantly after reporting better-than-expected earnings and sales, but overall growth remains modest, raising questions about its valuation in the AI tech sector [1][2][5]. Group 1: Earnings Performance - IBM reported an adjusted profit of $3.92 per share, exceeding analyst expectations of $3.78, with sales of $17.56 billion, slightly above the forecast of $17.54 billion [1]. - Despite the positive adjusted earnings, GAAP earnings for the quarter declined 13% year-over-year to $3.09 per share, and for the full fiscal year, GAAP earnings fell 21% to $6.43 per share [2]. Group 2: Revenue Growth - Sales growth for the fourth quarter was minimal at 1%, and for the entire fiscal year, sales increased only 1.5% [2]. - The CEO highlighted double-digit revenue growth in the software segment and reported that the generative AI business has reached over $5 billion, up nearly $2 billion quarter-over-quarter [3]. Group 3: Cash Flow and Profit Margins - IBM generated $12.7 billion in positive free cash flow in 2024, which is double the reported GAAP net income of $6 billion [4]. - The company improved its operating profit margin by 50 basis points in the fourth quarter and saw a 130 basis point increase in non-GAAP margins for the full year [4]. Group 4: Future Guidance - Management expects revenue growth of at least 5% for the current year and a modest increase in free cash flow to $13.5 billion [5]. - With a market capitalization of $239.5 billion, IBM is valued at approximately 17.7 times the projected free cash flow, which is considered cheaper compared to many other tech stocks, although concerns remain about the low sales growth rate [5].

Core Insights - IBM shares surged 13% following the release of fourth-quarter results that exceeded analysts' expectations, driven by strong performance in its AI-enabled business [2][4] - The company reported adjusted earnings per share (EPS) of $3.92, surpassing the consensus estimate of $3.79, and revenue of $17.55 billion, slightly above expectations [2][4] Financial Performance - IBM's fourth-quarter adjusted EPS was $3.92, exceeding the Visible Alpha consensus of $3.79 [2][4] - Revenue for the quarter was reported at $17.55 billion, which was marginally higher than analysts' expectations [2][4] AI Business Growth - The generative AI segment of IBM's business has grown significantly, with a total value exceeding $5 billion since inception, marking an increase of nearly $2 billion from the previous quarter [3][4] - CEO Arvind Krishna emphasized that IBM's AI products offer clients a scalable AI foundation based on open-source technology [3]

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