Key Stats for IBM Stock
- Price Change: -0.8%
- Current Price: $292
- Advanced Model Price Target: $307
The Street targets $304. The Model targets $307. Who is right? Run the numbers on TIKR →
What Happened This Week?
IBM (IBM) stock pulled back 0.8% on Friday, closing at $292 as investors positioned themselves ahead of the company’s Q4 earnings report scheduled for January 28, 2026.
The minor dip comes amid broader sector rotation, but the company remains active, announcing new partnerships with S&P Global and Groq this week to embed WatsonX into supply chain tools.
These moves are part of a larger strategy to integrate the massive $11.0 billion acquisition of Confluent, which analysts expect to close in mid-2026 to bolster IBM’s real-time data streaming capabilities.
While the stock has rallied 33.0% over the past year, market sentiment is currently weighing the stability of its software revenue against a valuation that leaves little room for error.
See analysts’ growth forecasts and price targets for IBM stock (It’s free!) >>>
Is IBM Undervalued Today?
The case for IBM (IBM) rests on its pivot from legacy hardware to becoming the backbone of Data for AI, a strategy detailed by SVP of Infrastructure Ric Lewis.
Lewis highlighted that the current z17 mainframe cycle is outperforming its predecessor, stating it is running “above 120% program to program” compared to the z15 and z16 cycles.
He emphasized that the conversation with clients has shifted from cost reduction to Data for AI, noting that infrastructure is now about helping businesses “harness their data to drive transformative outcomes.”
This Data for AI focus is reinforced by the pending Confluent acquisition, which will allow IBM to control the real-time data streams that power modern AI agents.
However, TIKR’s Advanced Valuation Model suggests the market has largely priced in this turnaround.
- Advanced Model Price Target: $307
- Current Price: $292
- Potential Upside: +5.0%
The model assumes IBM (IBM) can maintain steady but modest growth, projecting a 1.2% annualized return through 2029 as the stock consolidates its recent gains.
Unlike high-growth tech plays, the model values IBM as a compounder, explicitly rewarding its consistent free cash flow and dividend stability rather than speculative revenue expansion.
It factors in the sticky nature of the recurring software revenue attached to the z17 cycle, which provides a high floor but limits the ceiling for explosive upside.
Conclusion: IBM (IBM) has successfully reinvented itself for the AI era. However, with a valuation model pointing to $307, the stock appears to be a Hold for income and safety rather than a high-growth play like IonQ (IONQ).
See the full IBM forecast on TIKR >>>
How Much Upside Does IBM Stock Have From Here?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
