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Here's Why IBM (IBM) Fell More Than Broader Market
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The latest trading session saw IBM (IBM - Free Report) ending at $196.70, denoting a -0.55% adjustment from its last day's close. This change lagged the S&P 500's daily loss of 0.19%. Elsewhere, the Dow saw an upswing of 0.1%, while the tech-heavy Nasdaq depreciated by 0.54%.
Shares of the technology and consulting company have appreciated by 7.66% over the course of the past month, outperforming the Computer and Technology sector's gain of 2.36% and the S&P 500's gain of 3.18%.
The upcoming earnings release of IBM will be of great interest to investors. The company is expected to report EPS of $1.59, up 16.91% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $14.56 billion, indicating a 2.18% growth compared to the corresponding quarter of the prior year.
For the full year, the Zacks Consensus Estimates project earnings of $10.07 per share and a revenue of $63.79 billion, demonstrating changes of +4.68% and +3.12%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for IBM. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.3% upward. IBM is currently sporting a Zacks Rank of #3 (Hold).
From a valuation perspective, IBM is currently exchanging hands at a Forward P/E ratio of 19.65. For comparison, its industry has an average Forward P/E of 17.89, which means IBM is trading at a premium to the group.
One should further note that IBM currently holds a PEG ratio of 3.88. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Computer - Integrated Systems industry currently had an average PEG ratio of 2.66 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 199, which puts it in the bottom 22% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow IBM in the coming trading sessions, be sure to utilize Zacks.com.
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Here's Why IBM (IBM) Fell More Than Broader Market
The latest trading session saw IBM (IBM - Free Report) ending at $196.70, denoting a -0.55% adjustment from its last day's close. This change lagged the S&P 500's daily loss of 0.19%. Elsewhere, the Dow saw an upswing of 0.1%, while the tech-heavy Nasdaq depreciated by 0.54%.
Shares of the technology and consulting company have appreciated by 7.66% over the course of the past month, outperforming the Computer and Technology sector's gain of 2.36% and the S&P 500's gain of 3.18%.
The upcoming earnings release of IBM will be of great interest to investors. The company is expected to report EPS of $1.59, up 16.91% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $14.56 billion, indicating a 2.18% growth compared to the corresponding quarter of the prior year.
For the full year, the Zacks Consensus Estimates project earnings of $10.07 per share and a revenue of $63.79 billion, demonstrating changes of +4.68% and +3.12%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for IBM. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.3% upward. IBM is currently sporting a Zacks Rank of #3 (Hold).
From a valuation perspective, IBM is currently exchanging hands at a Forward P/E ratio of 19.65. For comparison, its industry has an average Forward P/E of 17.89, which means IBM is trading at a premium to the group.
One should further note that IBM currently holds a PEG ratio of 3.88. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Computer - Integrated Systems industry currently had an average PEG ratio of 2.66 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 199, which puts it in the bottom 22% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow IBM in the coming trading sessions, be sure to utilize Zacks.com.