International Business Machines Stock Forecast: Trending Analyst Upside

International Business Machines (IBM) stock has risen 5.7% over the past week, 4.4% in the last month, and 22.8% over the past year, signaling a solid upward trend that has caught investors’ attention. Wall Street’s analysts are moderately bullish, with a 12‑month consensus price target of $335.19 versus a last closing price of $309.24, suggesting further upside potential over the coming year. The overall Analyst Consensus stands at “Moderate Buy,” indicating that, while enthusiasm is not unanimous, the balance of opinion leans clearly positive.

One of the key voices backing IBM is analyst Wamsi Mohan of Bank of America, who reiterated a Buy rating on the stock on January 29, 2026, and raised his price target to $340.00. This new target sits above the broader Street consensus and points to additional room for gains from current levels. Mohan’s track record is strong: he ranks 110 out of 11,984 analysts on TipRanks, with a success rate of about 62.37% and an impressive 25.10% average return per rating, making his positive stance on IBM particularly noteworthy for investors.

Mohan’s report highlights that IBM recently delivered better‑than‑expected profit and free cash flow, even after absorbing roughly $300 million in workforce rebalancing charges in the fourth quarter. While those charges briefly pressured quarterly margins, IBM still managed around 100 basis points of profit margin expansion for the year and posted free cash flow of $14.7 billion, well ahead of the increase in net income. For fiscal 2026, the company is guiding to more than 5% constant‑currency revenue growth and free cash flow of $15.7 billion, higher than earlier expectations that were closer to $15 billion, underscoring IBM’s improving cash‑generation profile.

Under the surface, IBM’s business mix is shifting toward higher‑margin software and data‑driven services, which Mohan sees as a key driver of long‑term value. While Red Hat slowed to 8% year‑over‑year growth due to delays in the federal business, areas like Data grew 19% year over year, helped by strength in artificial intelligence and strategic partnerships. Hybrid cloud is expected to grow at a double‑digit pace in 2026, and the analyst projects overall Software growth of roughly 7% organically plus another 3% from M&A, even as Infrastructure faces low‑single‑digit declines due to tough mainframe comparisons. Consulting, meanwhile, is expected to grow at a low‑ to mid‑single‑digit rate, supported by AI‑related demand and improving backlog trends.

Based on these dynamics, Mohan models 2026 revenue of $71.0 billion and earnings per share of $12.20 for IBM, and values the company using a 23x multiple of his 2027 free cash flow estimate to justify the $340 price objective. With the stock already up strongly over the past year but still trading below both his target and the broader Street average, investors are watching closely to see if IBM can keep executing on its AI, hybrid cloud, and software‑mix strategy. Never miss a stock rating. Find all the latest ratings on TipRanks’ Top Wall Street Analysts page.