IBM: Oversold with Upside Potential

IBM is among the S&P 500's most oversold stocks with a low RSI score, indicating heavy selling pressure. Analysts project an average price target of $275.17, while GuruFocus' GF Value suggests a potential downside of 22.82%. The stock is rated "Outperform" by 23 brokerage firms with an average recommendation of 2.5.

International Business Machines Corp (IBM) has been identified as one of the most oversold stocks in the S&P 500, according to recent data from GuruFocus. The company's relative strength index (RSI) stands at a low 20.22, indicating significant selling pressure [1]. Analysts, however, see potential in IBM's stock, with an average target price of $275.17, suggesting a possible upside of 17.38% from the current trading price of $234.43 [1].

GuruFocus, on the other hand, provides a contrasting perspective. The GF Value metric suggests a potential downside risk, forecasting a fair value of $180.94 for IBM, indicating a downside risk of 22.82% from the current share price [1]. This discrepancy highlights the differing views among analysts and investment platforms regarding IBM's stock valuation.

Institutional investors and hedge funds hold 58.96% of IBM's stock, demonstrating significant confidence in the company's future prospects [2]. During the first quarter, Zions Bancorporation National Association UT acquired a new stake in IBM, buying 1,406 shares valued at approximately $350,000 [2]. Other notable acquisitions include MinichMacGregor Wealth Management LLC, Left Brain Wealth Management LLC, Alpha Cubed Investments LLC, Wedbush Securities Inc., and Nationale Nederlanden Powszechne Towarzystwo Emerytalne S.A., further underscoring the interest in IBM's stock [2].

IBM reported its latest quarterly earnings on July 23, 2025, with earnings per share (EPS) of $2.80, beating the consensus estimate of $2.65 [2]. The company's revenue for the quarter was $16.98 billion, up 7.7% year-over-year [2]. Analysts project an average EPS of $10.78 for the current year [2].

The stock has received varying ratings from analysts. BMO Capital Markets raised their price target to $300, while UBS set a lower target of $200, indicating mixed sentiment on IBM's performance [3]. Despite the mixed sentiment, 23 brokerage firms collectively rate IBM at an average recommendation of 2.5, categorizing it as an "Outperform" [1].

IBM's stock has a market capitalization of $224.80 billion, a price-to-earnings ratio of 39.27, and a beta of 0.69 [2]. The company operates through Software, Consulting, Infrastructure, and Financing segments, providing integrated solutions and services worldwide [2].

References:
[1] https://www.gurufocus.com/news/3056370/ibm-among-most-oversold-sp-500-stocks
[2] https://www.marketbeat.com/instant-alerts/filing-zions-bancorporation-national-association-ut-acquires-new-stake-in-international-business-machines-corporation-nyseibm-2025-08-11/
[3] https://www.marketbeat.com/instant-alerts/filing-international-business-machines-corporation-nyseibm-shares-sold-by-mizuho-markets-americas-llc-2025-08-10/