‘Intriguing Quantum Play,’ Says Investor About IBM Stock

Among the various companies looking to make their mark in the quantum space is one of the very first tech companies: International Business Machines (NYSE:IBM).

Seeking to capitalize on the next trend in computing technology, to date IBM has already deployed more than 75 quantum systems worldwide – while earning $1 billion in revenues from the technology.

One investor known by the pseudonym Noah’s Arc Capital Management believes that IBM’s ability to blend both quantum and classical computing will serve it quite well going forward.

“While IBM is facing strong competition from Google and Microsoft, as well as agile startups, I think that IBM’s full-stack integrated approach gives it an advantage over many quantum plays,” asserts the 5-star investor.

Noah’s Arc notes that IBM is working to move beyond the 1,000-qubit threshold to build computing systems with real-world applications. The investor explains that this should allow the company to build “a direct path to monetization.”

Moreover, Noah’s Arc mentions that IBM’s CEO expects quantum computing to add onto existing technical capabilities, and not serve as a replacement for them. This gives IBM a leg up on the competition.

“Most quantum companies are going for a pure quantum route, which I think means their commercialization efforts are going to be limited to the speed they can put quantum computers (which are unstable) into physical environments where they can be monetized,” adds Noah’s Arc.

Of course, the investor notes, IBM’s ability to take advantage of this opportunity rests upon the successful execution of its quantum vision. While heartened by IBM’s $1 billion in quantum sales, Noah’s Arc would like to see the company disclose its quarter-to-quarter bookings to allow investors to better understand its progress.

Still, the investor is downright bullish regarding IBM’s potential to be one of the leaders in this emerging field.

“IBM has been a computing innovator for over 100 years—before they were even technically computers! Quantum is a real chance for them to get back to their roots and lead,” concludes Noah’s Arc, who is rating IBM a Strong Buy. (To watch Noah’s Arc’s track record, click here)

Wall Street by-and-large feels good about IBM as well. With 8 Buy, 6 Hold, and 1 Sell rating, IBM possesses a Moderate Buy consensus rating. Its 12-month average price target of $260.00 would translate into gains of ~5% in the year ahead. (See IBM stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.