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IBM
International Business Machines Corporation - NYSE

7/10/2014, 1:37 AM ET
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  • The Future Is Cloudy For Buffett's Investment In IBM
    YCharts Yesterday, 8:34 AM 50 Comments

    Summary

    • IBM has undergone transitions in the past and these transitions are usually traumatic. The present paradigm shift towards the Cloud promises the same sort of trauma for Big Blue.
    • Cloud-based computing will have an effect on the three main parts of IBM’s business: hardware, consulting, and software. We investigate the economic effects on each in this article.
    • IBM’s financial engineering has come under critical scrutiny. One graph has allowed this author to come to peace with IBM’s prodigious leverage.
  • Why IBM Lacks Upside In The Near Term
    Benjamin Livingston Mon, Jul. 7 14 Comments

    Summary

    • IBM is in a time of transition where they have failed to generate revenue growth in recent years.
    • Share buybacks are simply an artificial way to boost earnings per share and hit targets.
    • Valuation shows IBM is fairly valued with minimal upside.
  • IBM: Accurately Priced Or Undervalued?
    Michael Lee Mon, Jul. 7 11 Comments

    Summary

    • The global economy is improving and seemingly stable.
    • Technology services are expecting solid growth.
    • IBM fundamentals are an uncertainty.
    • Emerging markets remain strong.
  • The Truth About IBM No One Comes Out To Say
    Tim McAleenan Jr. Fri, Jul. 4 85 Comments

    Summary

    • The notion that IBM needs to grow revenues in order to be a successful investment is a myth that underestimates the extent of the company's buyback.
    • Even though revenues have declined 3-4% in total since 2008, the company has still managed to grow profits per share by over 60% and raise dividends by over 90%.
    • Despite lower revenues entering 2014 compared to 2008, IBM has still managed to return 8.84% annually.
  • IBM Running Out Of Easy Ways To Keep The Shareholders Satisfied
    Dana Blankenhorn Wed, Jul. 2 38 Comments

    Summary

    • IBM sales and profits are on a downhill run.
    • The company is masking its problems with happy talk and cost-cutting.
    • This kind of story seldom ends well.
  • Security Concerns Put IBM / Lenovo x86 Server Deal In Limbo
    Trefis Tue, Jul. 1 4 Comments

    Summary

    • News has emerged that the latest deal between IBM and Lenovo is in limbo following the U.S. government's security concerns over IBM's x86 servers.
    • The servers are extensively used in the country's communications networks and in data centers that support the Pentagon's computer networks.
    • IBM and Lenovo faced a similar situation in 2005 when Lenovo bought IBM's personal computer business.
  • IBM: Getting A Good Return?
    Jason Russ Tue, Jul. 1 34 Comments

    Summary

    • IBM has spent over $45 billion on stock buybacks in the last 12 quarters.
    • In addition to cutting back the outstanding shares, the company has avoided paying dividends of over $1.2 billion over that time.
    • I will discuss how good (or bad) the return on investment has been for the buybacks.
  • Is IBM's Weakness A Buying Opportunity?
    Mitu Anand Mon, Jun. 30 10 Comments

    Summary

    • IBM is down this year, as its financial growth hasn't kept pace with analyst expectations.
    • IBM is currently undergoing a transition that is leading to short-term pains, but expects to bounce back once the transition is complete.
    • Given IBM's cheap valuation and its strategies, it looks like a good buy on the pullback.
  • Why IBM's Stock Is A Long-Term Investment Opportunity
    Arie Goren Wed, Jun. 25 25 Comments

    Summary

    • After the retreat in its stock price, it is now an excellent opportunity for a long-term investment in IBM at a cheap price.
    • IBM will benefit from its actions to transform parts of the business and to shift aggressively to its strategic growth areas including cloud, big data analytics, social, mobile and security.
    • IBM’s stock is ranked third among all S&P 500 tech stocks yielding more than 2%, according to the "All-Stars: Buffett" powerful ranking system.
  • Why This Bear On IBM Is Moving Toward A Bullish Posture
    DoctoRx Wed, Jun. 25 42 Comments

    Summary

    • IBM stock has become controversial, with the bears getting aggressive and going against lots of fervent supporters of the shares.
    • IBM shares have massively underperformed the market over the past two years, and their time may be coming.
    • Yet, the fundamentals suggest the stock could well be overvalued and that IBM could lead a fresh bear market to the downside, if the current bull market gives way.
    • Because of IBM's worsening underperformance plus fundamental factors, I have moderated my bearishness on IBM, and I'm now looking and hoping for a reason to go long this name.
  • IBM: Dividend Yield On Cost Could Reach 3% In 2 Years
    Stock Gamer Wed, Jun. 25 7 Comments

    Summary

    • Free cash flow may grow by high single digit CAGR over the next few years driven by improved profitability and relatively steady capex trend.
    • Continued share buybacks also will support dividend per share growth.
    • A dividend per share CAGR of 11%-12% is sustainable over the next few years with both free cash flow and earnings dividend payout ratios being stable.
    • Dividend yield on cost will rise to 3.0% based on my dividend forecasts.
    • Current valuation only implies a 7.0%-7.5% dividend growth rate.
  • What Attracted Warren Buffett To IBM?
    Dividend Growth Investor Tue, Jun. 24 38 Comments

    Summary

    • Back in 2011, Warren Buffett invested billions of dollars in IBM. This move by the Oracle of Omaha surprised many, since he is widely known to avoid technology stocks.
    • Buffett and his partner Charlie Munger acquire businesses that (1) Are easy to understand (2) Have a durable moat (3) Are run by able and honest management and (4) Are fairly priced.
    • In this article, I discuss how IBM fits Buffett's four filters.
  • Warren Buffett Is Missing Red Flags At IBM
    Jesse Bellet Wed, Jun. 11 93 Comments

    Summary

    • IBM has a market capitalization of $186 billion and pays a dividend of 2.4%.
    • While many investors watch the EPS figure, they may be ignoring the large amounts of cash invested in receivables and financing arrangements.
    • Amazon is disrupting not only the retail industry, but also tech juggernauts such as IBM.
  • A Big Blue Déjà Vu: Is It 1914 Or 1984 For The Long-Term IBM Investor?
    Peter E. Greulich Tue, Jun. 10 30 Comments

    Summary

    • Tom Watson Sr. inherited a company in financial and cultural trouble.
    • John Akers inherited a company in financial trouble.
    • Ginni Rometty inherited a company in cultural trouble.
    • The next path chosen—not the roadmap enforced—will determine IBM’s long-term future.
  • IBM's Stagnant Revenue May Be Coming To An End And It's Priced At A Discount Right Now

    Summary

    • IBM is sitting at 13% to 27% discount depending on which tool you use.
    • IBM has increased its dividends for 19 years at a compounded annual growth rate of 17.5%.
    • With earnings per share expected to reach $20 by 2015, and ample free cash flow, IBM's dividend should continue to grow at least 10% annually.
    • As $24B has been invested into Big Data, and 15 planned data centers, totaling to 40 across the globe, revenue may start to pick up in a couple years.
  • IBM: The Updated Outlook For 2014
    Bottom Up Investing Mon, Jun. 9 1 Comment

    Summary

    • Divestitures will adversely impact headline 2014 financial performance.
    • The shares are fairly valued, but that doesn't mean they can't become overvalued.
    • There are visible signs of accumulation of IBM shares as the primary trend shifts to bullish.
  • IBM Is A Buy - Chinese Companies Still Prefer Its Servers
    Alcaraz Research Mon, Jun. 9 5 Comments

    Summary

    • IBM is still the preferred choice among Chinese companies. This is in spite of Chinese government's directive to drop IBM due to alleged spying issues.
    • Chinese corporations are not too keen in replacing IBM with local-made servers from Chinese IT companies like Huawei and Inspur.
    • IBM’s mainframes and software are deeply embedded in the Chinese banking system. Replacing IBM is a very costly and risky undertaking that discourages immediate implementation.
  • IBM's Hidden Source Of Value
    Dividend Garden Fri, Jun. 6 29 Comments

    Summary

    • IBM trades at a discount relative to its peers.
    • It is a Dividend Contender, having increased its dividend for nineteen consecutive years at a CAGR of 19%.
    • Its massive share repurchase program is boosting EPS.
IBM vs. ETF Alternatives
Company Description

International Business Machines Corp is an Information Technology (IT) company. It creates business value for clients and solves business problems through integrated solutions that leverage information technology & knowledge of business processes.