Should You Buy International Business Machines Corp (IBM) Today? Analysis, Price Targets, and 2026 Outlook.
Conclusion
Buy
Latest Price
294.160
1 Day change
0.10%
52 Week Range
324.900
Analysis Updated At
2026/01/29
BUY for a beginner long-term investor with $50k–$100k. IBM just delivered a strong Q4’25 earnings catalyst (software + AI acceleration, upbeat 2026 cash flow outlook) and the post-market breakout suggests renewed institutional demand. Even after the sharp after-hours jump, Wall Street’s newer targets skew higher (330–360), congress trading is net-positive, and options flow is mildly bullish—making IBM a good buy right now for an investor who doesn’t want to wait for a pullback.
Technical Analysis
Trend/price action: The stock closed at 294.16 and then jumped to 316.74 post-market (+7.68%), which implies a bullish gap and a likely breakout above prior resistance (R2 ~313.31). That shift is trend-positive near-term.
Momentum: Pre-earnings indicators were mixed (MACD histogram -0.812 but contracting; RSI(6) ~43.7 neutral; moving averages converging). The earnings gap can flip the trend bullish, but it also means price is extended versus the prior pivot (299.66).
Key levels: Prior resistance 308.10 and 313.31 become support zones after the gap. If the stock holds above ~313, the breakout is technically confirmed; below that, it risks filling part of the earnings gap.
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Options Data
Bullish
Open Interest Put-Call Ratio
Bullish
Option Volume Put-Call Ratio
Sentiment read: Open-interest put/call of 0.94 is near balanced (not overly hedged), while the volume put/call of 0.54 is call-leaning (more bullish trading activity). IV metrics show moderately elevated interest (IV percentile 64) consistent with a post-earnings/major-move environment. Overall, options positioning tilts mildly bullish rather than defensive.
Software and AI acceleration: Software revenue +12% and AI business +32% highlighted in the news—supports the "IBM as software/AI platform" rerating narrative.
2026 outlook: News flow referenced a strong cash flow forecast for 2026, reinforcing long-term investor appeal.
Congress trading (last 90 days): 6 buys vs 4 sells, with much larger buy sizing (buy range $1.6M–$6.5M; median ~$4.1M) than sells (median ~$0.8M), indicating influential net-positive behavior.
Neutral/Negative Catalysts
Post-earnings price extension: The stock jumped sharply after-hours to ~316.74, which can create near-term digestion risk versus prior technical levels.
Mixed profitability signal in prior quarter: Q3 2025 showed revenue growth but large YoY declines in net income/EPS (likely impacted by one-offs), which can keep some investors cautious on earnings quality.
Some analyst caution at current levels: JPMorgan remains Neutral with a $312 target, implying less upside versus the current post-market price.
Financial Performance
Latest quarter (Q4 2025): News indicates revenue of ~$19.7B (+6% YoY) with adjusted EPS of $4.52, plus a constructive 2026 cash flow outlook—this is a positive growth/quality signal led by software and AI.
Prior reported snapshot (Q3 2025): Revenue rose to $16.33B (+9.11% YoY) and gross margin improved to 57.32%, but net income and EPS fell sharply YoY (net income $1.744B; EPS 1.84), suggesting non-operational items or timing effects weighed on bottom-line comparability.
Growth
Profitability
Efficiency
Analyst Ratings and Price Target Trends
Recent trend: Multiple firms raised price targets into/around earnings and most commentary is constructive. Evercore reiterated Outperform and raised PT to $330; RBC reiterated Outperform and raised PT to $350; Oppenheimer initiated Outperform with $360; Erste upgraded to Buy. JPMorgan raised PT to $312 but kept Neutral.
Wall Street pros: Growing confidence in software-led growth (Automation/Red Hat), AI monetization, improving consulting trajectory, and stronger cash flow outlook.
Wall Street cons: At least one major bank (JPM) argues the stock already prices in solid results at these levels; upside may be more incremental unless IBM sustains AI/software acceleration.
Wall Street analysts forecast IBM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for IBM is 315.8 USD with a low forecast of 210 USD and a high forecast of 375 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
16 Analyst Rating
Wall Street analysts forecast IBM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for IBM is 315.8 USD with a low forecast of 210 USD and a high forecast of 375 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
11 Buy
4 Hold
1 Sell
Moderate Buy
Current: 293.860
Low
210
Averages
315.8
High
375
Current: 293.860
Low
210
Averages
315.8
High
375
JPMorgan
Neutral
maintain
$290 -> $312
AI Analysis
2026-01-21
Reason
JPMorgan
Price Target
$290 -> $312
AI Analysis
2026-01-21
maintain
Neutral
Reason
JPMorgan raised the firm's price target on IBM to $312 from $290 and keeps a Neutral rating on the shares. The firm expects IBM to report "solid" Q4 results led by acceleration in software, with strength in automation and Red Hat as transaction processing growth recovers. However, the shares are pricing in solid results at these levels, the analyst tells investors in a research note.
Evercore ISI
Outperform
maintain
$315 -> $330
2026-01-20
Reason
Evercore ISI
Price Target
$315 -> $330
2026-01-20
maintain
Outperform
Reason
Evercore ISI raised the firm's price target on IBM to $330 from $315 and keeps an Outperform rating on the shares, which were also added to the firm's "Tactical Outperform list" ahead of IBM reporting December-end quarterly results on Wednesday, January 28. The firm expects the company to deliver in-line to slight upside compared to consensus revenue and EPS estimates, with performance driven by Infrastructure strength and improvement in Consulting, the analyst tells investors. For 2026, the firm expects IBM to initially guide to growth that is at the lower end of their mid-single-digit target range and about $15B in free cash flow, the analyst added.
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