[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]  DonCorleone77 [@CorleoneDon77](/creator/twitter/CorleoneDon77) on x 5372 followers Created: 2025-07-21 12:43:56 UTC $IBM Attached is page X of a 12-page Bank of America analyst report on IBM issued yesterday entitled: "Tough near-term setup given YTD outperformance but structural LT tailwinds" Bank of America has a 'Buy' rating on IBM with a $XXX price target. Bank of America's summary statement regarding IBM in the report includes the following: "Focus will be on growth and cash flows: IBM reports F2Q25 earnings on July 23rd, and we believe investors expect an acceleration in RHT, potential FX tailwinds, and for Consulting to be weak (similar to peers). While the tactical setup is a bit challenging given decelerating trends in parts of the business, we reiterate our Buy rating as we continue to view IBM as a defensive investment with improving revenue growth, which in turn can drive higher cash flows that could be re-invested for more M&A. We expect IBM to largely maintain its overall guide for the year but with slightly lower Transaction processing (TP) and slightly better RHT. Investors likely to focus on organic growth trends: While RHT would accelerate slightly and remains an important part of the bull case on IBM, we expect TP to modestly decelerate and overall software growth (ex-Hashicorp contribution of ~$200mn) to decelerate on an organic cc basis from X% in 1Q to X% in 2Q and model modest acceleration into 3Q. While bears could argue such a deceleration would continue into the future, we view the TP deceleration as not structural and expect IBM to benefit from share gains in RHT from VMware. We expect 2Q25 reported growth of 4.7%, cc growth of 2.3%, organic cc growth of X% and organic cc less Infrastructure (Mainframe+, Power -) contribution of 0.7%. We view growth in 2Q as not indicative of the trajectory for the rest of the year especially with TP and RHT reacceleration. -- Price Objective Basis: Our PO of $XXX is based on 24x EV/FCF. Our target multiple for IBM exceeds the high end of the historical range 8-22x, with median 13x. We believe a multiple at the high end/exceeding the historical range is justified given the company's improving growth and FCF trajectory with Red Hat. -- Downside risks: (1) failure to execute on the company's growth roadmap, (2) inability to realize expected cost savings from restructuring, (3) technology/competitor risk in hardware, software, and services, (4) unforeseen currency impacts on revenue and profits, (5) acquisition integration, given IBM's acquisitive nature, and (6) increased concern of economic uncertainty and tightening corporate IT budgets. -- Upside risks: (1) faster reacceleration of topline, (2) faster improvement in margins, (3) better-than-expected accretion from M&A, and (4) delivery of upside to FCF." (Page X is not available here as X does not allow me to post pages from reports on this platform) XXX engagements  **Related Topics** [united states](/topic/united-states) [bank of](/topic/bank-of) [$ibm](/topic/$ibm) [ibm](/topic/ibm) [stocks technology](/topic/stocks-technology) [bank of america](/topic/bank-of-america) [stocks financial services](/topic/stocks-financial-services) [stocks banks](/topic/stocks-banks) [Post Link](https://x.com/CorleoneDon77/status/1947276355189559399)
[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]
DonCorleone77 @CorleoneDon77 on x 5372 followers
Created: 2025-07-21 12:43:56 UTC
$IBM
Attached is page X of a 12-page Bank of America analyst report on IBM issued yesterday entitled:
"Tough near-term setup given YTD outperformance but structural LT tailwinds"
Bank of America has a 'Buy' rating on IBM with a $XXX price target.
Bank of America's summary statement regarding IBM in the report includes the following:
"Focus will be on growth and cash flows:
IBM reports F2Q25 earnings on July 23rd, and we believe investors expect an acceleration in RHT, potential FX tailwinds, and for Consulting to be weak (similar to peers). While the tactical setup is a bit challenging given decelerating trends in parts of the business, we reiterate our Buy rating as we continue to view IBM as a defensive investment with improving revenue growth, which in turn can drive higher cash flows that could be re-invested for more M&A. We expect IBM to largely maintain its overall guide for the year but with slightly lower Transaction processing (TP) and slightly better RHT.
Investors likely to focus on organic growth trends:
While RHT would accelerate slightly and remains an important part of the bull case on IBM, we expect TP to modestly decelerate and overall software growth (ex-Hashicorp contribution of ~$200mn) to decelerate on an organic cc basis from X% in 1Q to X% in 2Q and model modest acceleration into 3Q.
While bears could argue such a deceleration would continue into the future, we view the TP deceleration as not structural and expect IBM to benefit from share gains in RHT from VMware. We expect 2Q25 reported growth of 4.7%, cc growth of 2.3%, organic cc growth of X% and organic cc less Infrastructure (Mainframe+, Power -) contribution of 0.7%. We view growth in 2Q as not indicative of the trajectory for the rest of the year especially with TP and RHT reacceleration.
-- Price Objective Basis:
Our PO of $XXX is based on 24x EV/FCF. Our target multiple for IBM exceeds the high end of the historical range 8-22x, with median 13x. We believe a multiple at the high end/exceeding the historical range is justified given the company's improving growth and FCF trajectory with Red Hat.
-- Downside risks:
(1) failure to execute on the company's growth roadmap, (2) inability to realize expected cost savings from restructuring, (3) technology/competitor risk in hardware, software, and services, (4) unforeseen currency impacts on revenue and profits, (5) acquisition integration, given IBM's acquisitive nature, and (6) increased concern of economic uncertainty and tightening corporate IT budgets.
-- Upside risks:
(1) faster reacceleration of topline, (2) faster improvement in margins, (3) better-than-expected accretion from M&A, and (4) delivery of upside to FCF."
(Page X is not available here as X does not allow me to post pages from reports on this platform)
XXX engagements
Related Topics united states bank of $ibm ibm stocks technology bank of america stocks financial services stocks banks