RBC Capital has reaffirmed an Outperform rating on IBM (NYSE:IBM) and held its price target at $350.00, signaling the firm’s continued confidence in the technology company’s strategic placement across hybrid cloud computing, artificial intelligence and longer-term work in quantum computing. RBC analyst Matthew Swanson underpins the call and expects IBM to post solid year-end results, with the possibility of upside to both total revenue and free cash flow targets.
At the time of this report, IBM is trading at $296.33 and shows a price-to-earnings ratio of 35.41, a level that suggests a premium valuation. InvestingPro data referenced in market commentary indicates IBM is slightly overvalued when measured against its Fair Value assessment.
Market attention is concentrated on IBM’s upcoming fourth-quarter results, due January 28, where consensus expectations include $19.2 billion in revenue and $4.29 in earnings per share. RBC’s outlook leaves room for upside to those figures, while other analysts take differing stances on the near-term story.
Recent analyst moves provide a snapshot of divergent views across the sell-side. Evercore ISI has reiterated an Underperform rating, projecting results that are in line with or only marginally above current estimates, citing strength in IBM’s Infrastructure segment as a primary driver. Stifel has maintained a Buy rating, pointing to improved software execution and growth prospects as supportive of a constructive view.
Bank of America Securities has raised its price target to $335 while keeping a Buy rating, but it flagged the prospect of softer profit margins tied to workforce rebalancing initiatives. Jefferies moved to upgrade IBM from Hold to Buy, highlighting what it describes as a clearer path to software growth, particularly within the Red Hat business.
Software revenue components remain a focal point for investors evaluating IBM’s trajectory. Management has previously warned of continued headwinds for Red Hat through the end of the year, which the company says could set the stage for a re-acceleration in fiscal year 2026 should conditions improve.
Beyond financials, IBM has extended a long-running technology partnership with the Wimbledon tennis tournament, continuing a collaboration that began in 1995. The renewal underscores ongoing strategic efforts to maintain visible, long-term corporate relationships as part of the company’s broader market positioning.
As the January 28 earnings release approaches, market participants will be watching whether IBM can sustain the recent momentum implied by 4.51% revenue growth over the last twelve months, and whether software execution and free cash flow can meet or exceed analyst expectations. The mix of analyst ratings and price targets reflects both confidence in IBM’s secular exposure to cloud and AI and differing assessments of near-term operational execution and valuation.