Bernstein Raises International Business Machines (IBM) Target but Flags Full Valuation After Q4 Beat

Bernstein noted however IBM bushed statement expectations connected revenue, net per share, and escaped currency travel successful its latest quarterly report. The institution anticipates nett borderline enlargement of astir 1 percent constituent and escaped currency travel of estimated $15.7 cardinal for FY26.

Its gross maturation and borderline betterment expectations align with its full-year guidance for the archetypal 4th of 2026. Further, IBM anticipates the closing of its Confluent acquisition by mid-2026, resulting successful an estimated $600 PTI dilution successful the 2nd fractional of 2026. The acquisition is apt to beryllium accretive to adjusted EBITDA successful FY27 and to escaped currency travel successful FY28.

Bernstein noted that IBM’s valuation appears full, peculiarly owed to IBM’s dense vulnerability to bundle and consulting, some of which are susceptible to AI-driven devaluation. Nevertheless, IBM’s banal has remained resilient.

“Our updated SOTP investigation implies that portion of the semipermanent upside from IBM’s nascent Quantum concern is already successful the stock.”

International Business Machines Corporation (NYSE:IBM) is simply a multinational exertion institution and a pioneer successful artificial intelligence, offering AI consulting services and a suite of AI bundle products.

While we admit the imaginable of IBM arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you're looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the champion short-term AI stock.

READ NEXT: 30 Stocks That Should Double successful 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This nonfiction is primitively published astatine Insider Monkey.