Though the company has not experienced the same Bull run from the current AI hype, IBM in my opinion is not a poor hold. To be honest, in addition to its track-record as dividend atistocrat there is enough deep value locked in its business to make it a more than decent stock to hold for the long-term. IBM has shown its ability to adapt and pivot when industries and demand changes. In this respect, it has shown to stay relevant in contemporary times.
Sure if you do a deep dive in its management, cash flow operations and product/service offerings there are arguments that might paint a different picture. Moreover, why invest in a company that does not have the same sex appeal as Microsoft, Oracle or Google and is underperforming if looked at these competitors. Even the current PE (over 60) could indicate that in IBM is at best fairly priced. So why even bother to give it a second glance.
Well, IBM, the ugly ducklin compared to its peers, is about to become a Swan again. Looking at the growth potential of its AI business, there are significant indicators that it will see value grow in the mid-long term. Apart from AI, the consultancy division also have potential for future growth. I would even argue that the risk of owning IBM stock is mitigated by its strong record of dividend payments. This makes it an asset that will provide sufficient cash-flow.
Though I am not claiming that its stock will see a 2 ot 3 x in growth (I do not see this happening), I am willing to bet that it will beat the S&P 500.
What are your thoughts? At time of writing I own 7 stocks and have gained approximately 10 %
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