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IBM (IBM) Gains As Market Dips: What You Should Know

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In the latest trading session, IBM (IBM - Free Report) closed at $142.80, marking a +0.52% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.3%. Elsewhere, the Dow lost 0.2%, while the tech-heavy Nasdaq lost 0.1%.

Prior to today's trading, shares of the technology and consulting company had gained 2% over the past month. This has lagged the Computer and Technology sector's gain of 3.24% and outpaced the S&P 500's loss of 0.62% in that time.

Investors will be hoping for strength from IBM as it approaches its next earnings release. On that day, IBM is projected to report earnings of $2.28 per share, which would represent a year-over-year decline of 2.15%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $15.06 billion, down 19.68% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $9.89 per share and revenue of $60.99 billion, which would represent changes of +24.72% and -13.84%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for IBM. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. IBM is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, IBM is currently trading at a Forward P/E ratio of 14.37. This represents a discount compared to its industry's average Forward P/E of 32.09.

We can also see that IBM currently has a PEG ratio of 1.59. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Computer - Integrated Systems stocks are, on average, holding a PEG ratio of 1.59 based on yesterday's closing prices.

The Computer - Integrated Systems industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 170, putting it in the bottom 33% of all 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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