Goldman Sachs Downgrades IBM (IBM) to Neutral, PT Cut to $200

July 9, 2013 7:03 AM EDT
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Price: $166.80 -0.65%

Rating Summary:
    10 Buy, 21 Hold, 4 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 13 | Down: 22 | New: 54
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Goldman Sachs downgraded IBM (NYSE: IBM) from Buy to Neutral with a price target of $200.00 (from $220.00) citing choppier performance ahead.

In the downgrade report Goldman Sachs analyst Bill Shope comments, "Our Buy rating on IBM has been largely based on our view that the company's business model provides a unique source of counter-cyclicality during periods of volatile IT spending. Unfortunately, we believe that pressures on IBM’s growth markets and higher-margin revenue streams may intensify in the near term, weakening some of the key sources of IBM's earnings and cash flow resiliency in coming quarters."

The firm lowered 2013-2015 estimates. For 2013, they now expect revenues and EPS of $103.66 billion and $16.61, as compared with $104.44 billion and $16.71 previously. Goldman's 2014 forecast now calls for revenues of $105.67 billion and EPS of $17.92, versus $106.73 billion and $18.10 previously. For 2015, they expect sales of $108.12 billion and EPS of $20.01 as compared with our prior forecast of $109.21 billion and $20.07.

For an analyst ratings summary and ratings history on IBM click here. For more ratings news on IBM click here.

Shares of IBM closed at $194.98 yesterday.

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