IBM: Berenberg maintains 'sell' despite 'creditable' quarter
(CercleFinance.com) - Berenberg maintains its "sell" rating on IBM, with a price target of 125 dollars, after the company delivered a "creditable" quarter.
IBM reported a 1% beat on both revenue and earnings, largely driven by the mainframe cycle and despite deteriorating gross margins, the German broker said in a note.
"We believe the underlying trends in strategic imperatives are not strong enough, delaying IBM's return to growth”, Berenberg wrote in the report.
The broker said it is still worried about (1) the lack of clear growth engines; (2) the significant impact on profitability of the ongoing business transformation in a difficult IT capex spending environment; and (3) a demanding valuation given the growth profile.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
IBM reported a 1% beat on both revenue and earnings, largely driven by the mainframe cycle and despite deteriorating gross margins, the German broker said in a note.
"We believe the underlying trends in strategic imperatives are not strong enough, delaying IBM's return to growth”, Berenberg wrote in the report.
The broker said it is still worried about (1) the lack of clear growth engines; (2) the significant impact on profitability of the ongoing business transformation in a difficult IT capex spending environment; and (3) a demanding valuation given the growth profile.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.