Shares of International Business Machines (NYSE:IBM) gained in after-hours trading after the company reported earnings for its third quarter of Fiscal Year 2023. Earnings per share came in at $2.20, which beat analysts’ consensus estimate of $2.12 per share.
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Sales increased by 5% year-over-year, with revenue hitting $14.8 billion. This beat analysts’ expectations by $70 million. The IT giant reported an 8% increase in its Software revenue, 6% in constant currency. Furthermore, the company stated that the revenue increase was due to consistent demand for its software solutions as well as stronger-than-expected mainframe business.
Looking forward, management now expects revenue growth for Fiscal Year 2023 to be in the range of 3%-5% and free cash flow to come in at $10.5 billion.
Is IBM a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on IBM stock based on one Buy, four Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average IBM price target of $145.50 per share implies a 6.28% upside potential.
