10 AI Stocks Making Moves This Week

8. International Business Machines Corporation (NYSE:IBM)

Number of Hedge Fund Holders: 56

International Business Machines Corporation (NYSE:IBM) is a multinational technology company and a pioneer in artificial intelligence, offering AI consulting services and a suite of AI software products. On May 8, Stifel analysts maintained a “Buy” rating on the stock with a price target set at $290.00. The rating has been issued after the company’s investor event at its annual user conference.

The analysts noted that the event focused on how IBM is using AI and hybrid cloud tools like Red Hat to help businesses adopt AI. Stifel analysts particularly highlighted three areas that can influence IBM’s earnings growth over the short and long term. The first substantial factor that analysts noted for margin expansion and free cash flow (FCF) growth has been IBM’s internal efforts to deploy AI. Through the said deployment, IBM will be able to increase internal investments in areas such as research and development, marketing, and more.

Second, watsonx Orchestrate, IBM’s generative AI and automation solution, was recognized as having the potential to become a commercial product that helps other businesses increase productivity. Finally, the next generation of IBM’s mainframe, z17, was pointed out as a way for IBM to reclaim workloads that have shifted to x86 servers and cloud platforms. The analysts concluded with a positive outlook on IBM, stating that the company’s focus on growth appears stronger now than before.