10-20-2014, 10:17 AM
(This post was last modified: 10-20-2014, 10:19 AM by Roadmap2Retire.)
As someone working in the tech industry, I find IBM to be a dinosaur. They are stuck in the old ways and are too sluggish to move forward. And especially in an industry where things move fast, even if you are standing still - you are considered moving backward.
Technologically, IBM is just resting on the old accolades. They have already sold their server and desktop business to Lenovo, selling the chip business now. They still lead in a few fields like supercomputers and AI, but who knows how long that'll last (Google and Microsoft have some pretty fantastic/smart teams in their AI divisions although the target market slightly different - but still look out for competition there).
This is a company that has its third quarter profits fall 99%!! And pretty much abandoned its 2015 forecast. That is just unacceptable for a company with a heritage like IBM. And what is the response to that? Board is being asked to authorize more buybacks! Over the last few quarters, they have unveiled some pretty horrific numbers and have resorted to financial engineering like buybacks to prop up their numbers. Buyback programs like IBM's are the reason why I hate the buyback programs.
Can you tell that I hate the stock? IBM has the resources to turn things around - which could result in a great contrarian play. I for one would never invest in IBM under the current conditions.
On a side note, I just opened a small starter position in Apple last week. I am speculating here, but with the rumors of Apple getting introduced into the DJIA after the stock split, I think IBM is one that could get kicked out of the index.
Technologically, IBM is just resting on the old accolades. They have already sold their server and desktop business to Lenovo, selling the chip business now. They still lead in a few fields like supercomputers and AI, but who knows how long that'll last (Google and Microsoft have some pretty fantastic/smart teams in their AI divisions although the target market slightly different - but still look out for competition there).
This is a company that has its third quarter profits fall 99%!! And pretty much abandoned its 2015 forecast. That is just unacceptable for a company with a heritage like IBM. And what is the response to that? Board is being asked to authorize more buybacks! Over the last few quarters, they have unveiled some pretty horrific numbers and have resorted to financial engineering like buybacks to prop up their numbers. Buyback programs like IBM's are the reason why I hate the buyback programs.
Can you tell that I hate the stock? IBM has the resources to turn things around - which could result in a great contrarian play. I for one would never invest in IBM under the current conditions.
On a side note, I just opened a small starter position in Apple last week. I am speculating here, but with the rumors of Apple getting introduced into the DJIA after the stock split, I think IBM is one that could get kicked out of the index.