IBM Inc. | $IBM Stock | Shares Soar On Earnings Beat

0
388
IBM

International Business Machines Corporation (NYSE: IBM)

 

Tuesday, October 17th saw some interesting developments in the stock market. First, the Dow crossed 23,000 for the first time ever. However, the widely followed index closed below that level when the market closed at 4 p.m.

Another thing that happened of interest was that IBM reported their third-quarter earnings and they beat on both the top and bottom lines. Revenues came in at just over $19 billion dollars. Net income after certain one-time events came in at $3.30 a share which beat analyst expectations which were $3.28 per share.

The company attributed some of the increased earnings to their focusing a little more on cyber security and cloud computing.  Shares closed the regular trading session at $146.54 which was only down $0.29 on the day. However, after the earnings were released, shares soared up $8.18 which is 5.58% and closed at $154.72.

Company Comments

Ginni Rometty, IBM chairman, president and chief executive officer made these comments after the earnings came out:

“In the third quarter we achieved double-digit growth in our strategic imperatives, extended our enterprise cloud leadership, and expanded our cognitive solutions business. There was enthusiastic adoption of IBM’s new z Systems mainframe, which delivers breakthrough security capabilities to our clients.

Martin Schroeter, IBM senior vice president and chief financial officer added:

“During the first three quarters of the year, our strong free cash flow has enabled us to maintain our R&D investments and to expand IBM’s cloud and cognitive capabilities through capital investments. In addition, we have returned nearly $8 billion to shareholders through dividends and share repurchases.”

Analyst Comments

David Holt, an analyst with CFRA had this to say about IBM:

“The progress around the mainframe contribution, signings growth/visibility in consulting and positive trends in cloud likely sets up for further momentum in Q4,”.

Josh Olson, an analyst at Edward Jones stated

“Management is focused in the right areas, but still have some work and must demonstrate this growth is sustainable.

IBM Charts

IBM

The above price chart shows the daily action going back a few months. You will see the oval area colored in green which is where shares will likely open on Wednesday morning for trading.

IBM

The above price chart shows the 5 minute action during the day on the left and the after-hours session on the right. Shares shot right up after the earnings were released and never looked back.

Company Profile

International Business Machines Corporation provides information technology (IT) products and services worldwide. Its Cognitive Solutions segment includes Watson, a cognitive computing platform that interacts in natural language, processes big data, and learns from interactions with people and computers.

The company’s Cognitive Solutions segment also offers data and analytics solutions, including analytics and data management platforms, cloud data services, enterprise social software, talent management solutions, and solutions tailored by industry; and transaction processing software that runs mission-critical systems in banking, airlines, and retail industries.

The company’s Global Business Services segment offers business consulting services; delivers system integration, application management, maintenance, and support services for packaged software applications; and business process outsourcing services.

Its Technology Services & Cloud Platforms segment provides cloud, project-based, outsourcing, and other managed services for enterprise IT infrastructure environments. This segment also offers technical support, and software and solution support; and integration software solutions.

The company’s Systems segment offers servers for businesses, cloud service providers, and scientific computing organizations; data storage products and solutions; and z/OS, an enterprise operating system for z systems.

Its Global Financing segment provides lease, installment payment plans, and loan financing services; short-term inventory and accounts receivable financing to suppliers, distributors, and remarketers; and remanufacturing and remarketing services. It has a strategic collaboration with ABB Ltd to develop industrial artificial intelligence solutions.

The company was formerly known as Computing-Tabulating-Recording Co. and changed its name to International Business Machines Corporation in 1924. The company was founded in 1910 and is headquartered in Armonk, New York. YahooFinance

 

IMAGE CREDIT

LEAVE A REPLY