Analyst Erik Woodring from Morgan Stanley maintained a Hold rating on International Business Machines and keeping the price target at $233.00.
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Erik Woodring has given his Hold rating due to a combination of factors that present a mixed outlook for IBM. The company’s cloud-related data points have shown improvement quarter-over-quarter, indicating some positive momentum in this area. However, there is a cautious stance regarding core IT Services and AI-related data points, which have not shown the same level of progress.
Despite some advancements in cloud-related metrics, broader IT Services spending intentions and the adoption of Generative AI have declined compared to the previous quarter. Additionally, while IBM is gaining traction in digital transformation and cloud migration projects, it is still perceived as less willing to offer discounts, which could impact its consulting margins. These mixed signals contribute to the overall Hold rating, suggesting that while there are areas of strength, there are also significant challenges that need to be addressed.