IBM Shares to 175?

Reaching a new record, shares of International Business Machines Corp. (NYSE:IBM) have been projected to go even higher…  Approaching as high as $175 a share by end of 2011. 

(Bloomberg) - International Business Machines Corp. shares climbed to their third record in as many days as analysts raised their price estimates for the stock on increasing spending by corporations.

The shares rose 3.4 percent today after IBM posted sales and profit that topped estimates after-market yesterday. More than half of IBM analysts tracked by Bloomberg increased their price targets, including six who predict the stock will reach at least $175.

IBM reported sales growth in every division, as well as a bump in services contracts -- the first in a year -- and said it is on track to hit a goal of almost doubling operating earnings to $20 or more by 2015. The company has boosted per-share profit for more than 30 straight quarters, and investors are starting to take notice, said Rob Cihra, an analyst at Caris & Co.

“IBM steadily was able to even grow during the downturn, and IBM is slowly starting to get credit for that,” said New York-based Cihra, who rates IBM “above average” and has a 12- month price target of $175.

The world’s largest computer-services provider, which has its 100th anniversary this year, is also benefiting as corporations resume spending after the recession, said Chris Whitmore, a Deutsche Bank AG analyst, who predicts companies’ information-technology budgets will grow 6 percent this year. He boosted his price target for IBM by $20 to $175 today.

Fourth-quarter sales climbed 6.6 percent to $29 billion, with hardware revenue rising more than 20 percent as a mainframe computer introduced in July helped boost sales in that product category. Sales from the software division, accounting more than 40 percent of total profit, climbed 7 percent $7 billion.

IBM, based in Armonk, New York, forecast that operating earnings, which exclude acquisition and some retirement costs, will increase 11 percent to $13 a share this year.

The shares rose $5.04 to $155.69 at 4 p.m. in New York Stock Exchange composite trading for the biggest jump since May.

More at http://www.bloomberg.com/news/2011-01-19/ibm-shares-rise-to-record-as-analysts-say-stock-may-hit-175-within-a-year.html