In the latest trading session, IBM (IBM - Free Report) closed at $129.57, marking a -0.09% move from the previous day. This move lagged the S&P 500's daily gain of 0.21%. Meanwhile, the Dow gained 0.17%, and the Nasdaq, a tech-heavy index, added 0.27%.
Heading into today, shares of the technology and consulting company had lost 7.73% over the past month, outpacing the Computer and Technology sector's loss of 8.68% and lagging the S&P 500's loss of 5.26% in that time.
Wall Street will be looking for positivity from IBM as it approaches its next earnings report date. On that day, IBM is projected to report earnings of $3.06 per share, which would represent a year-over-year decline of 0.65%. Meanwhile, our latest consensus estimate is calling for revenue of $19.11 billion, down 4.45% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $13.89 per share and revenue of $76.82 billion. These totals would mark changes of +0.58% and -3.49%, respectively, from last year.
Any recent changes to analyst estimates for IBM should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, 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. Within the past 30 days, our consensus EPS projection has moved 0% higher. IBM is currently a Zacks Rank #3 (Hold).
Investors should also note IBM's current valuation metrics, including its Forward P/E ratio of 9.34. This represents a discount compared to its industry's average Forward P/E of 11.14.
Also, we should mention that IBM has a PEG ratio of 2.36. 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. The Computer - Integrated Systems industry currently had an average PEG ratio of 2.36 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 220, putting it in the bottom 15% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
You can find more information on all of these metrics, and much more, on Zacks.com.