Stock Forecast Based On a Predictive Algorithm. Contact Us: [email protected]

Summary:

• The debt load of International Business Machines is worrisome. IBM’s annual sales has been declining since 2011. It will be hard to pare down a total debt of $69.45 billion.
• IBM had to issue $20 billion in new debt (bond) last year to fund its $34 billion acquisition of Red Hat. This is why IBM’s long-term debt is now more than $52.4 billion.
• The debt-laden status of IBM plus its lingering inability to reverse the decline in its annual revenue is why its stock is undervalued and under-appreciated.
• Using debt to grow its cloud business is justified. However, Red Hat is not yet helping cloud revenue grow fast enough to mitigate the decline in IBM’s legacy enterprise business.
• We can only pray that this pandemic will encourage more companies to subscribe to IBM’s cloud computing solutions.

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