IBM report on Wednesday

IBM will report first-quarter results for 2014 on 16 April after the closing bell in New York. The consensus is for earnings per share of $2.29 and revenue of $22.9 billion.

IBM is trading at $197.03, up 7.3% since it revealed a 5% decline in revenue to $27.7 billion ($28.25 billion expected) for Q4 2013. 

Sales from the so-called BRIC economies (Brazil, Russia, India and China) dropped 14% on the quarter – China accounts for 5% of IBM’s business. It wasn’t all bad news, as the firm announced an increase in net income of 6% to $6.2 billion; however, this was partially due to a drop in its effective tax rate. CEO Ginni Rometty and her senior team passed on their bonuses for 2013; this could be a sign of belt-tightening.

IBM and its competitors are scrabbling for web-based software products such as cloud computing. If this is the way the industry is going I would place more stock in this side of the business rather than the hardware division, which is in decline.

The stock has support around the $195 mark and it has held up relatively well given the selloff in technology stocks recently. If the results are better than expected, it may head towards the $200 mark.

IBM is available for extended hours trading. Here is a  list of US stocks that can also be traded outside New York Stock Exchange trading hours of 2.30pm to 9pm (London time).

IBM Corp chart

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.

Find articles by analysts