Key Stats for IBM Stock
- Price Change for IBM stock: -13.2%
- IBM Share Price as of Feb. 23: $223
- 52-Week High: $325
- IBM Stock Price Target: $324.95
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What Happened?
International Business Machines Corporation (IBM) shares fell 13.2% on Feb. 23, marking one of the stock’s sharpest single-day declines in decades. The drop followed a widely circulated Anthropic post claiming its Claude Code tool can accelerate COBOL modernization work that has historically required large teams and long timelines.
Investors focused on the implication that AI-driven automation could compress demand for labor-intensive modernization projects. That matters because IBM’s mainframe ecosystem and consulting work often benefit when large enterprises modernize legacy systems rather than replace them quickly.
The move also came during a volatile period for AI-linked software stocks, as markets tried to price in how quickly new tools could reshape service revenue. IBM executives publicly pushed back on the idea that code translation alone solves mainframe modernization, but the stock still sold off on the headline risk.
Separately, IBM has continued to announce enterprise and government work, including its selection to support the Missile Defense Agency’s SHIELD program under an IDIQ contract with a ceiling of $151 billion. That contract headline was positive, but it did not offset the immediate concern around AI disruption narratives.
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What the Market Is Telling Us About IBM Stock
The selloff suggests investors are questioning how defensible IBM’s modernization and consulting opportunity is if AI tools reduce manual work. Even if IBM participates in AI-enabled delivery, faster timelines can pressure billable-hour economics for services-heavy projects.
At the same time, IBM’s profitability profile remains strong for a mature enterprise IT company. IBM’s LTM gross margin is 58.2%, and its LTM EBIT margin is 17.4%, according to TIKR data.
IBM also generates meaningful cash. LTM free cash flow is about $11.6 billion, and the stock offers a 3.0% dividend yield, which can matter more when growth narratives weaken.
However, leverage remains part of the story, with LTM net debt of about $50.2 billion and net debt/EBITDA of 2.77x. Investors will likely weigh capital returns against flexibility for acquisitions and reinvestment.
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Should You Invest in IBM?
The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.
Pull up IBM, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
You can build a free watchlist to track IBM alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.
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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!
