Oppenheimer initiated coverage of IBM (IBM) with an Outperform rating and $360 price target The firm says its bullish stance is predicated on its belief IBM’s software portfolio should see sustained “double-digit” revenue growth driven by strength in Automation and improving growth in RedHat, consulting should grow at a sustained “low single digits” with recovery in application development/management, and additional revenue optionality with creation and management of AI applications. Oppenheimer believes these drivers will result in strong expansion activity with existing customers, and drive continued gross and pre-tax margin expansion. The stock should also re-rate higher when IBM’s pivot to software is more widely appreciated, it adds.
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