IBM (IBM) issued 2024 guidance that topped expectations by analysts and teased a mainframe launch in 2025, setting the company up for strong revenue growth in the next two years, BofA Securities said in a reported dated Wednesday.
The company on Wednesday estimated $12 billion in 2024 free cash flow amid increased profitability and reduced cash requirements from changes to its retirement plans, and IBM can deliver almost $13 billion in free cash flow in 2025, given the strong trajectory, BofA said.
IBM’s software business probably will reaccelerate this year, and productivity improvements are poised support the company’s margins and cash flow, BofA said.
IBM on Wednesday reported Q4 non-GAAP diluted earnings and revenue that topped estimates by analysts.
BofA reiterated its buy rating on IBM and raised its price target to $200 from $170.
Shares of IBM jumped 13% in recent Thursday trading.