Street View: IBM set for long-term gains on AI enhancements and software demand

Hashicorp

30/01/2025 13:04

** IT software and consultancy services provider IBM  IBM.N 
surpassed Q4 profit estimates on Wednesday, driven by robust
demand in its software unit as businesses ramped up IT spending
    ** Shares of IBM up 9% at $249 in premarket trading
    
    WIRED FOR SUCCESS 
    ** Goldman Sachs ("buy," PT: $275) expects revenue growth
and strong free cash flow, driven by impressive bookings and AI
performance, with long-term growth from software and market
share gains in consulting
    ** BofA Global Research ("buy," PO: $270) sees IBM's 
potential to deliver higher-than-expected free cash flow (FCF)
despite HashiCorp  HCP.O  acquisition, with revenue and margins
likely to improve structurally over next few years
    ** J.P.Morgan ("neutral," PT: $244) sees software segment
performing well, supporting higher valuations, with significant
growth expected later in the year from AI-enhanced z17 mainframe
and M&A activity
    ** RBC Capital Markets ("outperform," PT: $276) sees co
focusing on software execution in early 2025, with increase in
consulting and infrastructure spending 
 

 (Reporting by Rashika Singh in Bengaluru)
 ((rashika.singh@thomsonreuters.com))