Today we applaud IBM for raising its dividend 18%. Stock sold off last week on what some would say was mixed results. 1st quarter numbers came in $.04 above consensus at $1.97 while revenues were flat year over year. We continue to like the stock for the long term and view the sell off as a buying opportunity. Here’s what we like about IBM:
1. Margins continue to improve.
2. Revenues should show improvement as the year progresses.
3. Cash flow continues to be robust (i.e., dividend hike)
4. We believe the stock is currently undervalued. Historically, IBM has traded on average at a market multiple. Using a 15x multiple and management’s 2010e of $11.20 our target is $168.
Catherine Avery Investment Management—CAIM Named to PSN Top Guns List of Best Performing Strategies for Q4 2024: Named ‘Manager of the Decade’
May 13, 2025
Quarterly PSN Top Guns List published by Zephyr identifies best-in-class separate accounts, managed accounts, and managed ETF strategies. Sarasota, FL , February 24, 2025 CAIM
