News Summary
The Teacher Retirement System of Texas made headlines by reducing its IBM holdings by 15.5%. The fund sold 53,184 shares, bringing its total to 290,427 shares valued at around $85.6 million. While some investors reduced their stakes, others significantly increased their ownership in IBM. Analysts remain optimistic about IBM’s future, with an average rating of ‘Moderate Buy’ and earnings surpassing expectations. As strategies shift, the moves by institutional investors will be crucial to monitor in the tech investment landscape.
Texas Teacher Retirement System Reduces IBM Holdings Amidst Mixed Institutional Investment Trends
The Teacher Retirement System of Texas has reduced its holdings in International Business Machines Corporation (NYSE:IBM) by 15.5% during the second quarter of this year. The fund sold 53,184 shares, resulting in ownership of 290,427 shares at the end of the quarter, with a total value of approximately $85.6 million.
Despite this reduction in shareholdings by the Texas Teacher Retirement System, several other institutional investors have increased their stakes in IBM. For instance, Brooklyn Investment Group raised its position in IBM by 32.7% in the first quarter, now holding 6,622 shares valued at $1.65 million after acquiring an additional 1,630 shares. Similarly, Edgar Lomax Co. VA increased its holdings by 5.7%, bringing its total to 235,967 shares valued at $58.68 million after purchasing 12,690 additional shares.
Other notable increases include Left Brain Wealth Management LLC, which raised its investment by an impressive 1,547.8%, now possessing 17,664 shares valued at $4.39 million after an additional purchase of 16,592 shares. Alpha Cubed Investments LLC and Wedbush Securities Inc. also increased their stakes in IBM by 47.0% and 5.6%, respectively. The former now has 7,507 shares valued at $1.87 million, while the latter holds 62,067 shares worth $15.43 million.
Overall, institutional investors and hedge funds now own 58.96% of IBM’s stock. In the wake of these investment activities, several financial firms have adjusted their price targets for IBM. BMO Capital Markets revised its price target from $300.00 to $305.00, maintaining a “market perform” rating. Bank of America raised its price objective from $310.00 to $315.00, confirming its “buy” rating.
Current Market Overview
The stock recently opened at $307.78 on Monday. It has a market capitalization of $287.69 billion, with a PE ratio of 36.82, and has experienced a 52-week low of $203.51 and a high of $310.75. IBM’s current ratio stands at 0.93, and its debt-to-equity ratio is 1.97.
In its most recent quarter, IBM reported earnings per share of $2.65, surpassing estimates of $2.45, and achieved a net margin of 12.09%. The company generated $16.33 billion in revenue, above the anticipated $16.10 billion, indicating a significant year-over-year growth of 9.1%.
Future Guidance and Dividends
Looking ahead, IBM has set guidance for fiscal year 2025, and analysts forecast a projected earnings per share of $10.78 for the current fiscal year. Furthermore, the company declared a quarterly dividend of $1.68 per share payable on December 10, which translates to an annualized dividend of $6.72 and a yield of 2.2%. The current dividend payout ratio for IBM stands at 80.38%.
Analyst ratings for IBM present a mixed outlook, with one “Strong Buy,” eight “Buy,” seven “Hold,” and one “Sell,” yielding an average rating of “Moderate Buy” and an average target price of $288.00.
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