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International Business Machines Corporation (IBM - Free Report) recently announced the completion of its acquisition of Sanovi Technologies, a business continuity and hybrid cloud recovery software provider.

Why this Move?

The acquisition will enhance IBM’s global business unit for technology services. Additionally, the acquisition will enable IBM to bring improvements in many areas such as software defined resiliency strategies, services related to business continuity and disaster recovery and Watson Analytics.

What Does the Sanovi Deal Mean for IBM?

The orchestration technology of Sanovi offers multiple benefits for organizations such as,

Automation: The technology is capable of automating the disaster recovery process.

Cost Cutting: Organizations can cut back on expenses related to disaster recovery by using Sanovi’s technology. It will also help them to save time.

Simplification:The central dashboard feature in Sanovi’s solution enables disaster recovery professionals to automate the whole process as well as monitor the recovery point and time targets.

With this acquisition, IBM will be able to strengthen its resiliency portfolio that includes management of data, applications and IT systems for clients who are using the hybrid cloud platform.

Cloud Scope

IBM has over 46 cloud data centers and 300 delivery data centers across the globe. With the Sanovi acquisition, IBM will be able to bolster its data center capabilities as well as penetrate deeper into the resiliency services and hybrid cloud infrastructure market over the years.

As per an IDC report, worldwide public cloud services spending is estimated to reach $195 billion by 2020 growing at a CAGR of 20.4%. Given the huge scope and gradual shift to the cloud by the organizations, such acquisitions are expected to augur well for the company in the long run.

Zacks Rank & Key Picks

At present, IBM has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology space are Applied Optoelectronics, Inc. (AAOI - Free Report) , Advanced Energy Industries, Inc. (AEIS - Free Report) and Amkor Technology, Inc. (AMKR - Free Report) each carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Notably, the consensus estimate for Applied Optoelectronics’ current year improved to 81 cents from 51 cents over the last seven days.

The consensus estimate for Advanced Energy improved to $2.67 from $2.51 over the last seven days.

Similarly, the consensus estimate for Amkor improved to 53 cents from 44 cents over the last seven days.

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