Valued at $231.6 billion by market cap, International Business Machines Corporation (IBM) is a global technology and consulting company headquartered in Armonk, New York, United States. Founded in 1911, IBM is a leading player in the enterprise tech space, known for its innovations in computing, artificial intelligence (AI), cloud services, and consulting.

The IT giant has significantly outperformed the broader market over the past year. IBM stock has soared 49.9% over the past 52 weeks and 13.4% on a YTD basis, outpacing the S&P 500 Index’s ($SPX) 8.6% gains over the past year and 3.8% dip in 2025.

Zooming in further, IBM has also outpaced the sector-focused Technology Select Sector SPDR Fund’s (XLK) 6.3% returns over the past year and a 6.4% dip in 2025.

IBM's stock dropped 7.5% on Apr. 24, despite posting better-than-expected first-quarter results. While the company exceeded sales and earnings expectations, the decline was driven by weaker-than-expected sales in its consulting segment, which dampened investor enthusiasm, particularly in light of IBM's AI potential. 

For the second quarter, IBM targets sales between $16.4 billion and $16.75 billion. The company also reaffirmed its full-year guidance for 5% sales growth and free cash flow of $13.5 billion.

For the fiscal year 2025 ending in December, IBM is projected to deliver a 5.6% year-over-year increase in non-GAAP earnings, reaching $10.91 per share. The company maintains a solid track record of outperforming expectations, having exceeded analysts’ earnings estimates in each of the last four quarters.

Among the 20 analysts covering IBM, the consensus rating is a “Moderate Buy,” a step up from “Hold” three months ago. The current consensus is based on seven “Strong Buy,” one “Moderate Buy,” 10 “Hold,” and two “Strong Sell” ratings.

This configuration is slightly more bullish than two months ago, when six analysts gave “Strong Buy” recommendations.

On May 7, analyst Daniel Ives from Wedbush reaffirmed an "Outperform" rating for IBM, maintaining a price target of $300, which is also the Street-high price target. This indicates Wedbush’s continued positive outlook on IBM's performance, with no changes to the price target or valuation expectations.

Its mean price target of $249.37 indicates a marginal premium from the prevailing market prices.