International Business Machines Corp (IBM) said last week that its Chief Executive Officer Ginni Rometty would step down in April and would be succeeded by Arvind Krishna, the head of its cloud business.
IBM shares closed higher for the fifth time in the past ten trading sessions in New York on Friday. It has also been the sharpest daily surge since January 23rd 2019. The stock went up 5.09% ($6.96) to $143.73, after touching an intraday high at $144.00, or a price level not seen since January 23rd ($144.41).
Shares of International Business Machines have risen 7.23% so far in 2020 compared with a 0.16% drop for the benchmark index, S&P 500 (SPX).
In 2019, IBM’s stock went up 17.92%, thus, it underperformed the S&P 500, which registered a 28.88% gain.
Arvind Krishna holds an undergraduate degree from the Indian Institute of Technology in Kanpur and a Ph.D. from the University of Illinois at Urbana-Champaign.
He joined IBM’s Watson Research in December 1990 and was part of that group until July 2009. Then, in 2013, Krishna was appointed as general manager of IBM Systems and Technology Group’s development and manufacturing organization.
In August 2019, in an interview with Business Insider, Krishna said he expected the hybrid cloud market to reach an aggregate value of $1.2 trillion in the future.
In another interview with CNN Money last week, he forecast the commercial availability of quantum computers at some point during the current decade.
Analyst stock price forecast and recommendation
According to CNN Money, the 17 analysts, offering 12-month forecasts regarding IBM’s stock price, have a median target of $154.00, with a high estimate of $173.00 and a low estimate of $121.00. The median estimate represents a 7.15% upside compared to the closing price of $143.73 on January 31st.
The same media also reported that at least 14 out of 20 surveyed investment analysts had rated IBM’s stock as “Hold”, while 4 – as “Buy”. On the other hand, 2 analysts had recommended selling the stock.