Tech company IBM (NYSE:IBM) used to be known for “big iron,” or huge-scale mainframes that filled rooms and led the way forward into the modern computing age. It would be easy to think that left it on the back foot as the future is much less about those systems. New word from Goldman Sachs, however, says quite the opposite. And that helped drive IBM up over 2% in Monday afternoon’s trading. Word from Goldman Sachs’ James Schneider proved a shot in the arm for Big Blue as he believes that IBM is modernizing nicely.
Schneider declared this effort a “bullish” signal, and that was enough for investors to hear. IBM was in its “middle innings” of such a move, making more advancement into artificial intelligence (AI) and other modernized systems like infrastructure software.
In fact, IBM’s AI business has been “…doubling quarter after quarter.” While that only means so much—especially if you’re going from $100 to $200—it means much more the farther in you get. After all, double a penny every day and you’re talking big money shockingly soon.
New Rollouts Reveal New Course
IBM has been working on a range of new products and services geared toward capturing new markets. It just showed off an upgrade to its Storage Scale system, which is being referred to as “Hyperstore.” Storage Scale is the latest version of General Parallel File System (GPFS), which has been around for quite some time. But the new version draws on a system known as NVMe over Fabrics (NVMe-oF) that speeds up storage and recovery with “…direct block-level storage drive access.”
Is IBM a Buy, Hold, or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on IBM stock based on five Buys, seven Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 39.85% rally in its share price over the past year, the average IBM price target of $182.71 per share implies 3.78% upside potential.
