IBM (IBM) shares ended the last trading session 3.7% higher at $219.05. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 19.5% loss over the past four weeks.
The uptrend was largely attributable to the increasing propensity of business enterprises to undertake a cloud-agnostic and interoperable approach to secure multi-cloud management with a diligent focus on hybrid cloud and generative AI solutions. With a surge in traditional cloud-native workloads and associated applications, along with a rise in generative AI deployment and quantum computing, there is a radical expansion in the number of cloud workloads that enterprises are currently managing. This has resulted in heterogeneous, dynamic and complex infrastructure strategies, which have led to a healthy demand trend for IBM's hybrid cloud.
This technology and consulting company is expected to post quarterly earnings of $3.02 per share in its upcoming report, which represents a year-over-year change of +7.9%. Revenues are expected to be $17.66 billion, up 4% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For IBM, the consensus EPS estimate for the quarter has been revised marginally lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on IBM going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
IBM belongs to the Zacks Computer - Integrated Systems industry. Another stock from the same industry, Seagate (STX), closed the last trading session 10% lower at $745.49. Over the past month, STX has returned -22.3%.
Seagate's consensus EPS estimate for the upcoming report has remained unchanged over the past month at $5.1. Compared to the company's year-ago EPS, this represents a change of +96.9%. Seagate currently boasts a Zacks Rank of #1 (Strong Buy).
7 Best Stocks for the Next 30 Days
Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."
Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention.
See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
International Business Machines Corporation (IBM): Free Stock Analysis Report
Seagate Technology Holdings PLC (STX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).