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IBM (IBM) Exceeds Market Returns: Some Facts to Consider

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In the latest close session, IBM (IBM - Free Report) was up +1.67% at $280.75. The stock's performance was ahead of the S&P 500's daily gain of 0.4%. Elsewhere, the Dow saw a downswing of 0.04%, while the tech-heavy Nasdaq appreciated by 0.66%.

The stock of technology and consulting company has risen by 7.23% in the past month, leading the Computer and Technology sector's gain of 2.27% and the S&P 500's gain of 1.02%.

Investors will be eagerly watching for the performance of IBM in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on October 22, 2025. The company is predicted to post an EPS of $2.43, indicating a 5.65% growth compared to the equivalent quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $16.09 billion, up 7.52% from the prior-year quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $11.12 per share and revenue of $66.79 billion. These totals would mark changes of +7.65% and +6.44%, respectively, from last year.

Investors should also take note of any recent adjustments to analyst estimates for IBM. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.02% higher. IBM presently features a Zacks Rank of #3 (Hold).

Digging into valuation, IBM currently has a Forward P/E ratio of 24.83. This represents a premium compared to its industry average Forward P/E of 22.47.

We can additionally observe that IBM currently boasts a PEG ratio of 4.25. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Computer - Integrated Systems industry held an average PEG ratio of 1.77.

The Computer - Integrated Systems industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 15, finds itself in the top 7% echelons 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.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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