IBM shares are growing, the company is moving in the right direction, investors are happy
Judging by the market situation, IBM shares finally went up after a long period of stagnation. Moreover, the positive dynamics turned out to be so bright that the company overtook Amazon in terms of the corresponding figures.
Since February, the value of the securities of the corporation has grown by 36%. Stock market analysts attribute this, in particular, to IBM’s purchase of Red Hat. But there were other success factors.
Why IBM Stocks Move Up
In the past 10 years, the position of IBM shares in the stock market was not the most optimistic. The company was in the process of adapting to new market demands and suffered from technology changes. IBM sales peaked in 2011, then the corporation entered new markets and acquired a number of IT firms, especially in the field of artificial intelligence, to increase revenue.
Now we can say that the development vector of IBM turned out to be correct. This is confirmed by the Morgan Stanley poll, according to which the activities of IBM CEO Ginny Rometti as part of the reorientation of the corporation to cloud technologies and neural networks had a positive impact on the share price.
In the fourth quarter of 2018, IBM’s revenue exceeded the maximum expectations of investors and grew to almost $ 22 billion. At the same time, the company said that by 2019 it plans to adjust the number of earnings per share to around $ 13.90 per share.
Despite the fact that IBM’s securities are still trading at 36% below the peak value, the company’s prospects are more than transparent, as is the interest in it among investors. IBM is also trying to gain a foothold in the new areas of the digital market, and for this, it bought Red Hat for $ 33 billion.
The development of the latter will improve the software of the corporation, especially thanks to the hybrid cloud services for corporate clients. Market experts believe that soon more than 80% of enterprises will use a hybrid approach, combining cloud services and their private format.
In this case, investors who aim to form a stable income should consider IBM stocks. They continue to delight their holders with a favorable rate, suitable for long-term players. It is reasonable, if possible, to keep the corporation’s securities with you since after buying Red Hat and against the background of constant cash flow from the main IBM divisions, they will grow.
