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Investing.com - RBC Capital raised its price target on IBM (NYSE:IBM) to $315.00 from $285.00 on Thursday, while maintaining an Outperform rating on the stock. The tech giant, currently trading at $281.16 and approaching its 52-week high of $296.16, has delivered impressive returns with a 55% gain over the past year. According to InvestingPro analysis, IBM is currently trading above its Fair Value.
The price target increase comes ahead of IBM’s second-quarter results, scheduled for July 23, which RBC expects to be primarily driven by software performance, with particular attention on potential Red Hat re-acceleration, GenAI bookings, and free cash flow seasonality. With a market capitalization of $255.73 billion and annual revenue of $62.83 billion, IBM remains a dominant force in the IT services industry. InvestingPro subscribers have access to 14 additional key insights about IBM’s financial health and market position.
RBC cited peer multiple expansion as the reason for its higher price target, suggesting IBM’s valuation is being adjusted to reflect broader industry trends.
The firm noted that beyond headline financial figures, IBM’s traction in GenAI and agentic orchestration and governance capabilities will remain important focal points for investors evaluating the company’s position in enterprise AI adoption.
IBM is preparing for a hardware refresh in the second half of 2025, though RBC expects the upcoming quarterly results to emphasize the company’s software business performance.
In other recent news, IBM has seen several notable developments. Stifel has raised its price target for IBM from $290 to $310, maintaining a Buy rating due to the company’s positive outlook ahead of its second-quarter earnings report. IBM’s revenue growth potential and annual margin expansion were highlighted as key drivers, alongside the z17 mainframe cycle and recent software acquisitions. The company also unveiled its Power11 servers, claiming zero planned downtime and improved ransomware protection, with availability set for July 2025. Additionally, Deutsche Telekom (OTC:DTEGY) has chosen IBM Concert for AI-powered patch management, significantly reducing its vulnerability patching time. In collaboration with Parsons (NYSE:PSN) Corporation, IBM is set to modernize the U.S. air traffic control system, enhancing the Federal Aviation Administration’s National Airspace System. Lastly, Evercore ISI reiterated its outperform rating on IBM, maintaining a $315 price target, despite potential impacts on consulting signings due to sector trends observed in Accenture (NYSE:ACN)’s recent results. These developments collectively reflect IBM’s strategic initiatives and market positioning.
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