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IBM to Commercialize Quantum Computing Using Cloud Platform
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International Business Machines Corporation (IBM - Free Report) recently announced plans to introduce quantum computing systems and services in the commercial space under the brand name “IBM Q”. The company will leverage its IBM Cloud platform to deliver these systems and services.
We note that this is an industry-first initiative undertaken by the technology giant and could revolutionize the way computing is being carried out in the present context.
International Business Machines Corporation Price and Consensus
Cognitive systems such as IBM Watson run on classical computers and are capable of finding patterns and insights by deciphering huge amount of data. However, in the absence of any such recognizable patterns, these systems are not of much use.
This is where quantum computers come into play as they are capable of providing solutions to problems where recognizable patterns don’t exist.
Quantum computing has its applications in many fields such as artificial intelligence, financial services, cloud security, drug discovery and supply chain and logistics.
What Does This Mean for IBM?
As per a Market Research Media report, worldwide spending on quantum computing is estimated to reach $5 billion by 2020. Not surprisingly then, competition in the sector is intensifying, with the presence of major players such as Microsoft (MSFT - Free Report) , Google (GOOGL - Free Report) , Intel, D-Wave Systems, Hewlett Packard and Lockheed Martin.
However, IBM with its industry-first initiatives looks poised to carve a niche in this segment.
Stock Performance Overview
Shares of IBM have underperformed the Zacks Computer - Integrated Systems industry over the last one year. While the industry gained 33.8%, the stock appreciated 28.4%.
The underperformance of the stock could be due to weakness in the company’s traditional businesses and shift toward the cloud that is keeping margins under pressure. However, we believe that IBM’s endeavor in the rapidly growing quantum computing field along with its strategic initiatives will help the stock rebound in 2017.
Notably, the Zacks Consensus Estimate for Digi International’s current year has improved to 43 cents from 42 cents in the last 60 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>
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IBM to Commercialize Quantum Computing Using Cloud Platform
International Business Machines Corporation (IBM - Free Report) recently announced plans to introduce quantum computing systems and services in the commercial space under the brand name “IBM Q”. The company will leverage its IBM Cloud platform to deliver these systems and services.
We note that this is an industry-first initiative undertaken by the technology giant and could revolutionize the way computing is being carried out in the present context.
International Business Machines Corporation Price and Consensus
International Business Machines Corporation Price and Consensus | International Business Machines Corporation Quote
Filling in the Market Gap
Cognitive systems such as IBM Watson run on classical computers and are capable of finding patterns and insights by deciphering huge amount of data. However, in the absence of any such recognizable patterns, these systems are not of much use.
This is where quantum computers come into play as they are capable of providing solutions to problems where recognizable patterns don’t exist.
Quantum computing has its applications in many fields such as artificial intelligence, financial services, cloud security, drug discovery and supply chain and logistics.
What Does This Mean for IBM?
As per a Market Research Media report, worldwide spending on quantum computing is estimated to reach $5 billion by 2020. Not surprisingly then, competition in the sector is intensifying, with the presence of major players such as Microsoft (MSFT - Free Report) , Google (GOOGL - Free Report) , Intel, D-Wave Systems, Hewlett Packard and Lockheed Martin.
However, IBM with its industry-first initiatives looks poised to carve a niche in this segment.
Stock Performance Overview
Shares of IBM have underperformed the Zacks Computer - Integrated Systems industry over the last one year. While the industry gained 33.8%, the stock appreciated 28.4%.
The underperformance of the stock could be due to weakness in the company’s traditional businesses and shift toward the cloud that is keeping margins under pressure. However, we believe that IBM’s endeavor in the rapidly growing quantum computing field along with its strategic initiatives will help the stock rebound in 2017.
Zacks Rank and Key Pick
At present, IBM carries a Zacks Rank #3 (Hold).
A better-ranked stock in the broader technology space is Digi International Inc. (DGII - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Notably, the Zacks Consensus Estimate for Digi International’s current year has improved to 43 cents from 42 cents in the last 60 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>