Erste Group Upgrades IBM to ‘Buy’ on Strong Q3 and Red Hat-Led Growth

Core Viewpoint - International Business Machines Corporation (IBM) is recognized as a significant player in the AI sector, with recent upgrades in stock ratings following strong financial performance and positive outlooks for future growth [1][2]. Financial Performance - IBM's management has raised its financial guidance for the full year 2025, now expecting revenue growth of over 5% and free cash flow to reach approximately USD 14 billion [2]. - The company's third-quarter performance was robust, contributing to the upgrade from Hold to "Buy" by Erste Group [1]. Business Segments - The software segment, particularly driven by Red Hat products, is anticipated to gain further importance, with analysts predicting higher sales growth for IBM in the upcoming year compared to the current year [2][3]. - IBM is a pioneer in artificial intelligence, providing AI consulting services and a range of AI software products [3]. Market Outlook - The positive outlook for IBM is expected to lead to further price gains for its shares [3].