The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 57 | 18.7x | 20.8x | Around median | |
Growth | 56 | 7.9% | 6.1% | Around median | |
Quality | 88 | 15.1% | 6.6% | Top tier | |
Safety | 58 | 2.7x | 0.7x | Around median | |
Capital Return | 75 | 3.13% | 2.02% | Top tier | |
Momentum | 22 | -11.0% | 4.1% | Bottom tier | |
Sentiment | 65 | 12 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
International Business Machines Corporation (IBM) is a global technology company whose strategy focuses on providing hybrid cloud software platforms and artificial intelligence for enterprises. The company generates its revenue through three main segments including Software, which includes Red Hat, data management, and automation; Infrastructure, which relies heavily on the Z mainframe series and storage solutions; and the Technology Consulting segment. The company focuses on mission-critical systems for large enterprises, leveraging the watsonx platform and strategic acquisitions like Confluent to integrate AI capabilities directly into transaction workflows and manage enterprise data securely and reliably.
During the first quarter of 2026, the company recorded strong financial performance with total revenue reaching $15.9 billion, achieving a gross profit of $8.9 billion and a net income of $1.2 billion, which translates to earnings per share of $1.28. The segment mix showed software revenue growth of 8 percent driven by accelerating Red Hat growth of 10 percent, while the infrastructure segment jumped by 12 percent thanks to massive growth of 48 percent in Z mainframe sales. Pre-tax operating profit margins also expanded by 140 basis points, and free cash flow reached $2.2 billion, marking its highest first-quarter level in a decade.
IBM's stock recently experienced a massive 25 percent correction, placing it in a highly volatile position compared to the average analyst price target of $315.15. Despite the historic sell-off and a 52-week range fluctuating between $212.34 and $332.46, the analyst consensus still maintains a buy recommendation. The stock is currently trading below the average price target, reflecting a stark contrast between the optimistic first-quarter guidance and the violent market reaction to the negative developments in July 2026.
Figures in the text are as of 2026-07-15; the live price is shown at the top of the page.
IBM has integrated AI directly into its Z mainframe series using the Spyre accelerator, allowing clients to run AI inference on 100 percent of transaction volume without moving data off the platform. This capability enables up to 450 billion AI inferences per day with millisecond latency, which financial institutions use extensively for real-time fraud detection. Furthermore, clients using watsonx Code Assistant for Z are expanding their MIPS capacity three times faster than those not using this tool.
In mid-July 2026, IBM stock recorded the worst daily drop in its history, plunging by 25 percent and losing approximately $67 billion of its market value. This collapse was driven by disappointing second-quarter financial results that showed a notable slowdown in software growth and a shift in corporate spending toward infrastructure and hardware. This sharp and sudden decline has triggered legal investigations pursuing the company, further complicating the landscape for investors.
IBM closed the acquisition of Confluent early in mid-March 2026, as part of its $10.5 billion investments in acquisitions during the first quarter. Although this early closing will dilute earnings by approximately $600 million in 2026 due to stock-based compensation and interest expenses, it represents a key growth driver. Confluent is expected to contribute more than 15 percentage points to the data segment's growth, which the company expects to exceed 20 percent for this year.
Automated analysis for informational purposes only — not investment advice.
The consulting segment recorded modest growth of 1 percent in the first quarter of 2026, impacted by currency challenges and the geographic mix of the business. However, generative AI has become a core driver for the segment, now representing about 30 percent of the backlog and generating annual recurring revenue exceeding $4 billion. The segment has returned to recording 6 percent growth in signings, thanks to client demand for modernizing applications and data to deploy AI securely.