IBM is the only tech stock Warren Buffett owns. In this video, Andrew Tonner describes why investors should be optimistic about Big Blue's future. Most analysts expect IBM earnings to grow about 9%, from $2.78 per share to about $3.50 per share. The company has a three-pronged business model that helps funnel customers from its low-margin hardware business to its higher-margin software business. IBM also has an even higher-margin consulting business, all of which position IBM well for its long-term goal of earning $20 per share. Corporate leadership looks solid and on board for achieving this goal.
IBM is a classic Buffett stock: a well-run, profitable company selling at a fair (certainly not cheap) price.
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The article Will This Buffett Stock Keep Marching Higher on Thursday? originally appeared on Fool.com.
Andrew Tonner has no position in any stocks mentioned. The Motley Fool owns shares of IBM. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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