Stock Price & Analysis

Based on the analysis, IBM stock is currently undervalued with strong growth prospects. Buy IBM stock as it has a positive outlook with potential for long-term growth.

The price prediction for IBM stock in 2025 is expected to range between $260 and $320. This forecast is driven by IBM's strong performance in artificial intelligence and hybrid cloud solutions, as well as positive earnings and free cash flow guidance. Analysts have set an average price target of $260, with some expecting up to $320 based on the company's growth momentum.

The S1 support level for IBM Stock is $239.82 ,The R1 resistant level for IBM Stock is $252.88.

As of the end of day on 2025-04-02, the price of IBM Stock was $247.01.

The target price for IBM Stock according to analyst rating is 260.00, with the highest price target at 320.00 and the lowest at 160.00. Analysts have a Moderate Buy rating on IBM Stock overall.

The market cap of IBM is $231.8B.

Analysis and Insights

To determine if IBM is overvalued, we analyze its financial metrics, analyst sentiment, and recent performance.

Valuation Metrics:

IBM's current valuation metrics are as follows:

• PE Ratio: 31.84 (2024/Q4)
• EV/EBITDA: 18 (2024/Q4)
• PS Ratio: 3.27 (2024/Q4)
• PB Ratio: 8.36 (2024/Q3)
• Dividend Yield: 3.03% (2024/Q4)

These metrics suggest IBM is trading at a premium compared to some industry peers, particularly in terms of EV/EBITDA and PB ratios, which may indicate overvaluation.

Analyst Sentiment:

Analysts have mixed opinions on IBM. While some maintain a "Hold" rating, others have raised their price targets, reflecting confidence in its AI and hybrid cloud growth. The average price target is around $260, suggesting moderate upside.

Financial Performance:

IBM reported strong Q4 revenue of $17.55 billion, with software revenue growing 10.4% year-over-year. This growth, driven by Red Hat and AI initiatives, supports its valuation. However, profit margins have declined slightly compared to previous years.

Conclusion:

While IBM's valuation metrics are elevated, its strong software and AI growth justify its premium. However, the stock may be fairly valued rather than overvalued given its consistent performance and strategic initiatives.

International Business Machines Corporation is engaged in addressing the hybrid cloud and artificial intelligence (AI) opportunity with a platform-centric approach, focused on providing client value through a combination of technology and business expertise. Its segments include Software, Consulting, Infrastructure and Financing. Its Software segment comprises two business areas: Hybrid Platform & Solutions, which includes software to help clients operate, manage and optimize their IT resources and business processes within hybrid, multi-cloud environments, and transaction processing, which includes software that supports client’s mission-critical, on-premises workloads in industries such as banking, airlines and retail. Consulting segment is engaged in business transformation, technology consulting and application operations. Infrastructure segment is engaged in hybrid infrastructure and infrastructure support. Financing segment is engaged in client financing and commercial financing.

Price Prediction for IBM Stock by 2030

Based on current trends and analyst consensus, IBM stock is predicted to reach $300 by 2030. This projection is supported by IBM's strong performance in AI and software growth, as well as its leadership in quantum computing and hybrid cloud solutions. Analysts expect continued momentum in these areas to drive long-term growth.

IBM has a total of 305300 employees.