qinbafrank
AI/Crypto/TMT Investor, Global Liquidity & Macro, Cycle-Based Investing
IBM should re-rate over the medium to long term on two fronts: quantum computing, where the U.S. government is taking a stake, and a broader software re-rating as software is no longer seen purely as an AI loser. IBM also has a strong customer base and channels, with deep customer stickiness. x.comÂ
IBM is the biggest winner of the US government's $2B equity investment in nine quantum-computing companies, taking $1B to found Anderon, the first US dedicated quantum-chip foundry, in New Albany, New York. The funding arrives as IBM's roadmap enters validation: it expects quantum advantage in 2026, launched its Nighthawk processor and targets a fault-tolerant computer by 2029. Like Intel, a struggling giant could re-rate on a state stake. Commercialization still has a long way to go. x.comÂ
IBM could reach a $2 trillion market cap as a sovereign AI play, per Hugh Hendry. Global banks refuse to trust unproven AI apps and want IBM's legacy structural safety, and it also offers a pure US foundry play on quantum computing; Hendry rates it a buy-and-hold long toward its 2012 highs near $210. x.comÂ
IBM, the quantum computing leader, is a buy after President Trump fast-tracked quantum computing with multiple executive orders, making the next three years especially interesting for the company. x.comÂ
IBM is extremely expensive, and its latest announcement adds caution: enterprises are prioritizing hardware and memory purchases, which pressures software spending. Quantum computing is a distant option, software is too small a part of the business to drive upside, and the stock carries a significant Trump premium. The same shift supports even stronger conviction in semiconductors and memory. x.comÂ
IBM has a quantum catalyst in a $10B five-year commitment and a big US government deal, plus AI and hybrid cloud tailwinds as watsonx and generative AI bookings run strong and enterprise automation accelerates. The stock is almost above its 200-day moving average with momentum increasing. Analysts have issued multiple buy upgrades, including DZ Bank at $295, with targets of $280-$340+, 12-30% above roughly $255, and earnings estimates are rising. x.comÂ
IBM could be next in line, after Dell and Intel, to benefit from the Trump-driven AI and domestic technology narrative. As the large-cap leader in quantum computing, it sits on an emerging theme that still feels early relative to AI infrastructure and data centers. Its price has reclaimed the weekly Ichimoku Cloud, typically a shift back to a bullish long-term trend, and a breakout to new all-time highs projects a path toward about $500. x.comÂ
IBM is a valuation trap, with a high-conviction sell target of $200 by December 2026 as its multiple compresses toward its historical average. It lags in AI and quantum, its premium P/E lacks the structural growth to justify it, and its CY26 EPS estimate of $12.35 is under threat. A macro slowdown could push enterprises to cut nice-to-have transformation projects, and missing hyped quantum milestones would speed a rerating as Google and Microsoft pull ahead. x.com x.comÂ
IBM stands to benefit from massive quantum investment: the Trump administration is awarding $2 billion in grants to nine quantum-computing companies, and IBM is getting $1 billion of it. The chart also shows support, with a tweezer bottom, a Friday push above the 200 EMA and a volume gap above. x.comÂ
IBM will win the quantum race with Trump's backing, as the US will not lose quantum to China, making it a 10+ year hold. It just unveiled the first sub-1nm chip technology, a 0.7nm NanoStack 3D transistor design, and its technical advances should only accelerate. x.comÂ
IBM trades at an AI premium with no real AI growth behind it. The company forecast only 1% growth yet more than doubled from $150 to over $320 on AI hype, while its AI business is effectively non-existent. Its Q2 earnings warning came from consulting and infrastructure, not software, and the stock has fallen back to its May level around $220. x.com x.com x.comÂ
IBM's record one-day drop, on pace to surpass its 1987 Black Monday decline, is the biggest overreaction since Netflix's near-40% plunge in 2022. IBM's CEO said only a few large capex deals in mainframe and its associated software were paused near quarter-end, not a widespread problem, and that IBM does not see its software being disrupted by AI at all. x.com x.comÂ
