IBM (IBM) closed the most recent trading day at $237.49, moving -4.38% from the previous trading session. This change lagged the S&P 500's 0.45% loss on the day. Meanwhile, the Dow lost 1.21%, and the Nasdaq, a tech-heavy index, lost 0.01%.
Shares of the technology and consulting company witnessed a gain of 6.75% over the previous month, beating the performance of the Computer and Technology sector with its loss of 1.9%, and the S&P 500's loss of 2.43%.
The upcoming earnings release of IBM will be of great interest to investors. The company's earnings report is expected on October 21, 2026. The company is predicted to post an EPS of $2.89, indicating a 9.06% growth compared to the equivalent quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $16.88 billion, indicating a 3.34% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $12.33 per share and revenue of $70.39 billion, which would represent changes of +6.38% and +4.22%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for IBM. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 0.01% fall in the Zacks Consensus EPS estimate. IBM presently features a Zacks Rank of #3 (Hold).
Investors should also note IBM's current valuation metrics, including its Forward P/E ratio of 20.15. For comparison, its industry has an average Forward P/E of 20.77, which means IBM is trading at a discount to the group.
It's also important to note that IBM currently trades at a PEG ratio of 2.37. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Integrated Systems industry currently had an average PEG ratio of 0.59 as of yesterday's close.
The Computer - Integrated Systems industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 32, positioning it in the top 14% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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International Business Machines Corporation (IBM): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).