International Business Machines Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
IBM's FY2025 was strong — revenue of $67.5B (+7.6% YoY), operating margin expansion to 18.5%, and EPS of $11.17 (+73.7% YoY) — but Q2 2026 revenue growth collapsed to 1.1% YoY (versus 9.5% in Q1 2026 and 12.2% in Q4 2025), creating genuine uncertainty about whether the hybrid-cloud and AI pivot is sustaining momentum.
The stock has recovered to $241.92, above its 50-day MA ($232.13) with a bullish MACD crossover (histogram +2.11), but remains below its 200-day MA ($251.14) and trades at a P/E of 21.1 (4.4% above the peer median). With Q3 2026 earnings due after the close on October 21, the call hinges on whether growth re-accelerates; holding until that data point is the prudent stance.
What could go wrong
- Growth deceleration persists. Q2 2026 revenue growth of 1.1% YoY was a sharp drop from Q1 2026's 9.5% and Q4 2025's 12.2%; if Q3 2026 confirms a trend rather than a one-quarter blip, the AI-pivot narrative weakens significantly.
- Technical overhead at 200-day MA. Stock at $241.92 remains below its 200-day MA of $251.14, a level that may act as resistance and cap upside until reclaimed.
- Smart money fading. Smart money score declined from 0.15 (as of 31 Dec 2025) to 0.03 (as of 30 Jun), suggesting institutional conviction is waning even as fund count rose to 69.
- Persistent insider selling. Over the trailing 24 months, insiders net sold 23,516 shares for net value of -$5.3M; recent acquisitions were only nominal 'Promised Fee Share' board grants, not open-market buys.
What would change my mind
Where this comes from: FY25 fundamentals · quarterly results · technicals, 20 Oct · peer comparison. Orin's read on IBM; not advice.
How has the share price moved?
Down 20.1% over twelve months, from $313.09 on 27 Oct 2025 to $250.25 at the Tue 27 Oct 2026 close. Its highest close in that time was $329.23 on 2 Jun 2026; the last close is 24.0% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 67.4M, on 14 Jul 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All IBM filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $21.6B | 0.3% |
| Vanguard Capital Management | $17.3B | 0.4% |
| State Street | $15.8B | 0.5% |
| Vanguard Portfolio Management | $8.0B | 0.4% |
| Geode Capital Management | $6.6B | 0.4% |
| Morgan Stanley | $4.9B | 0.3% |
| Capital World Investors | $4.6B | 0.5% |
| Bank of America | $4.2B | 0.3% |
| JPMorgan Chase | $3.5B | 0.2% |
| Northern Trust | $2.9B | 0.3% |
155 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 219 Form 4 filings; open-market trades net −$5.3M. Of the 50 on hand, 0 were open-market purchases and 1 a sale — the rest are grants, option exercises and tax withholding.
Ask Orin about IBM
Orin answers questions about IBM from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 21.0× its last 12 months of profit (Tue 27 Oct close) — higher than in 2 of its last 5 fiscal years (middle 26.1×); the typical Technology company on the NYSE is at 39.5×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 21.0×below usual | 26.1× | 39.5× |
| P/S | 3.39×above usual | 2.41× | — |
| EV/EBITDA | 16.6×below usual | 19.1× | — |
| P/B | 6.7×near usual | 6.6× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $271 (from $175 to $350) — 8% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$271
$175 – $350 · +8% against the last close
- 12 buy or overweight
- 5 hold
- 1 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 21.0× its last 12 months of profit; the middle P/E of the 3 companies it is compared to that made a profit is 20.1×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| IBMInternational Business Machines Corporation | $237B | 21.0× | 16.6× | 58.0% | 16.0% | 33% |
| ACNAccenture plc | $144B | 17.2× | 10.9× | 32.0% | 11.3% | 27% |
| MSFTMicrosoft Corporation | $3.95T | 29.5× | 19.1× | 67.9% | 40.3% | 33% |
| ORCLOracle Corporation | $395B | 20.1× | 13.6× | 63.9% | 26.4% | 43% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 21.0× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now21.0×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Technology companies on the NYSE were priced at a typical 39.5× their yearly profit (Tue 27 Oct close).
- Now39.5×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $302 a share — 21% above the $249.78 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $302 | 21% above $249.78 |
| Levered | $321 | 28% above $249.78 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.