IBM (IBM.US) becomes the focus with soaring popularity, and RBC raises its target price to US$250

On Thursday, RBC Capital Markets maintained its "outperform" rating on IBM (IBM.US) and raised its price target to $250 from $211, based on improving market sentiment. Shares were slightly lower in premarket trading, down 0.17% at the time of writing.

Matthew Swanson, an analyst at RBC Capital, wrote in a note to clients that in addition to the improving market sentiment, IBM will provide strong free cash flow data when it reports its third-quarter results later this month.

Swanson also said that software sales would be more attractive, especially from Red Hat. IBM management said that Red Hat sales would re-accelerate in the second half of the year, after the company's performance in the first half was driven by unexpected infrastructure spending and support for generative AI.