In the latest trading session, IBM (IBM - Free Report) closed at $131.99, marking a -0.1% move from the previous day. This move lagged the S&P 500's daily gain of 0.63%. At the same time, the Dow added 0.53%, and the tech-heavy Nasdaq gained 0.54%.
Coming into today, shares of the technology and consulting company had lost 4.18% in the past month. In that same time, the Computer and Technology sector gained 1.12%, while the S&P 500 gained 1.07%.
Investors will be hoping for strength from IBM as it approaches its next earnings release. On that day, IBM is projected to report earnings of $4.68 per share, which would represent a year-over-year decline of 3.9%. Our most recent consensus estimate is calling for quarterly revenue of $21.65 billion, down 0.49% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $12.80 per share and revenue of $77.02 billion. These totals would mark changes of -7.31% and -3.23%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for IBM. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. IBM is holding a Zacks Rank of #3 (Hold) right now.
Digging into valuation, IBM currently has a Forward P/E ratio of 10.33. This valuation marks a discount compared to its industry's average Forward P/E of 10.87.
Investors should also note that IBM has a PEG ratio of 2.07 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. IBM's industry had an average PEG ratio of 1.66 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 197, which puts it in the bottom 23% 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.