Photo by Mark Ahsmann
According to a report by Barron’s, a financial publication, International Business Machines (IBM) Corp. could be the next blue-chip company with an increasing valuation.
In it’s November 20 edition, Barron said that analysts expect IBM to return to growth during this quarter.
Barron’s said that IBM reported higher quarterly revenue from mobile, social, cloud, analytics, and security technology in October and a long drop in gross profit has already slowed.
Barron’s said that shares are trading at around 11 times in this year’s earnings forecast, well below that of the S&P 500.
The publication said that investors could receive their first clear sign that IBM is turning the corner when the company will possibly present its outlook for 2018 in January.
Even with only the upbeat news, investors could gain 30 percent or more over 2018, said Barron’s.
The shares of IBM shot up 8.9 percent on October 18, the day after the firm reported quarterly results. However, it has since given back most of those gains.
On Friday, the stock closed at $148.97 and is down by 10.3 percent for the year to date.