This week IBM (IBM) Raised to a Sell based on the most current relative pricing of its shares and news. International Business Machines Inc's (NYSE:IBM) Sell recommendation, which was recently up graded from a Strong Sell to Sell, is the conclusion of a process of analysis that is proprietary and produced outcomes that were below average conclusions in 4 areas: a ranking in its sector group that is in the bottom eighth, ranking in its industry group that is in the bottom eighth, an analytical score that is below average, and a numerical calculation of risk/reward that is unattractive; and produced above average in 2 areas: an economic sector rated above average in attractiveness, and an industry group rated above average in attractiveness. IBM has been upgraded from a Strong Sell to a Sell in the last week.
The company is a component of the 111 company Information Technology Services GICS industry group, which is a segment of the 323 company GICS Technology Services sector. IBM's market value is $145.5 billion which falls in the top decile in its industry group The stock's current Portfolio Grader ranking places it 107 among the 111 companies in this industry group, a position that is well below-average.
Currently, Portfolio Grader ranks the Technology Services sector number 1 among the 20 sectors in its universe putting it atop all the GICS sectors. The Information Technology Services industry group is ranked 14 among the 129 industry groups within the GICS sectors, placing it above-average in terms of the Proprietary Quantitative Score scoring system.
The scores achieved by IBM are average or below-average scores in 7 of the 8 areas appraised by Portfolio Grader in the ranking of company stocks.
IBM's operational scores are a source of great concern with a ranking for sales growth, operating margin and earnings growth that are substantially below average. Scores for visibility of earnings are a source of great concern with a ranking for earnings revisions, earnings surprises and earnings momentum that are worse than average. IBM's ranking for return on equity is significantly better than its industry group average but its grade for cash flow is below-average. Based on these fundamental scores, IBM places in the bottom quartile of the industry group.
Portfolio Grader uses the Proprietary Quantitative Score to gauge IBM's shares from the perspective of risk/reward. This proprietary scoring methodology weighs the relative value of the company's shares based on the recent $158.32 share price of the shares relative to its peers, the market and risk associated with its industry and sector groups. Based on this risk/reward calculation, IBM currently scores well below-average in its industry group compared to its peers.
The Proprietary Portfolio Grader stock ranking system assesses roughly 5,000 companies every week based on a number of fundamental and quantitative measures. Stocks are given a letter grade based on their results, with A being 'strong buy' and F being 'strong sell'. Explore the tool here.
Commentary provided by UpTick Data Technologies.