- Analysts comment on IBM’s (NYSE:IBM) earnings report yesterday, which beat estimates with revenue growth but included margin erosion.
- Cantor Fitzgerald’s Joseph Foresi notes that the first revenue growth in nearly six years came from strength in Systems and a hardware refresh cycle.
- But Foresi says IBM needs to return to consistent growth and margin expansion before a valuation multiple expansion can happen.
- Cantor rates IBM at Neutral with a $152 price target.
- More action: RBC’s Amit Daryanani questions the “quality” of the earnings since the non-GAAP tax rate was 6%, well below expectations, and gross margins were “soft.”
- Daryanani does say the CY18 guidance was “incrementally better” and could signal stabilization ahead.
- RBC rates IBM at Outperform with a $180 price target.
- Source: Bloomberg First Word
- IBM shares are up 4.5%.
- Previously: IBM -4.4% despite beating Q4 estimates, posting first revenue growth in nearly 6 years (Jan. 18)
- Previously: IBM Q4 earnings call: FY18 guidance, tax forecast, and margin erosion (Jan. 19)
- Now read: IBM: Growing Again, Driven By The Dollar
Original article