UBS Maintains a 'Neutral' on IBM (IBM); Raising Numbers Following ACN Results

UBS maintains a 'Neutral' on IBM (NYSE: IBM) price target raised from $195 to $203.

UBS analyst said, "Accenture (NYSE: ACN) results suggest strong demand trends in IT services as it saw broad-based demand w/double-digit y/y rev growth across all geos & industry verticals (TMT +17%, FS +10%). Bookings were strong in both consulting & outsourcing. ACN also noted it is seeing increasing demand for cloud & data analytics (key IBM growth initiatives). Separately, we expect IBM to increase its quarterly dividend by 13% to $0.85/sh & authorize a new share repurchase program on or around April 24th (avg. of last 4 authorizations was $8.25bn; $8.6bn remains in current program)."

"While our FY12EPS estimates remains unchanged at $14.95, we are re-adjusting our model to reflect stronger 2H relative to 1H to take hardware product cycles into account and a digestion period post-Q4 budget flush, our 1H estimates are slightly below Street Consensus." (UBS raises FY13 EPS estimate from $16.09 to $16.37)

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 $205.49 yesterday.

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