IBM stock forecast
IBM’s weighted price is $197.81 in October 2027. It hinges on deal conversion and durable software growth.
Where could IBM’s shares be by 2029?
IBM’s weighted outcome is a modest decline before a small three-year gain. The weighted price is $197.81 in October 2027, a 10% loss including dividends. It reaches $204.82 in October 2028, a 4% loss. By October 2029, it reaches $212.75, a 3% gain.
The range is wide because execution and valuation can move together. October 2029 spans $117.55 in the bear case to $367.52 in the bull case, against today’s $227.02. The base case has the highest probability at 50%. The bear case has 30%. The bull case has 20%.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 30 % | 145.89 (-33 %) | 131.46 (-36 %) | 117.55 (-39 %) |
| Base | 50 % | 203.45 (-7 %) | 205.96 (-3 %) | 207.96 (+1 %) |
| Bull | 20 % | 261.61 (+18 %) | 311.98 (+44 %) | 367.52 (+71 %) |
| Weighted | 100 % | 197.81 (-10 %) | 204.82 (-4 %) | 212.75 (+3 %) |
What has to go right for IBM, and what could go wrong?
The bear case uses revenue of $71,500 million in 2027 and $72,500 million in 2028. Revenue reaches $73,500 million in 2029, while margins fall from 15.0% to 14.2%. Earnings therefore decline from $10,725 million to $10,437 million. The bull case uses revenue of $74,500 million in 2027 and $79,000 million in 2028, reaching $83,500 million in 2029. Margins rise from 16.7% to 17.7%, producing earnings from $12,442 million to $14,780 million. Flat organic software growth, weaker consulting signings and a difficult post-launch IBM Z comparison support the downside; paid AI deployments, renewals and cross-selling support the upside.
The bear case assumes delayed deals remain weak, the z17 launch creates a difficult comparison and flat organic software growth combines with acquisition costs. Debt and cash demands then pressure both earnings and valuation. The price falls to $145.89 in October 2027 and $117.55 in October 2029, including dividends. Its probability is 30% because weak software growth, lower consulting signings and the post-launch IBM Z slowdown create several independent failure points.
How much cash does IBM really make?
IBM therefore removes changes in Financing receivables from its own free-cash-flow calculation. That makes its measure useful for judging the non-lending businesses, but it does not create extra cash or eliminate the money committed to customer loans.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Cash from operations | 13,193 | 13,445 | 13,931 | 10,435 | 11,184 |
| − Capital spending | 1,738 | 1,685 | 1,810 | 1,972 | |
| = Free cash flow | 11,455 | 11,760 | 12,121 | 8,463 | |
| − Stock pay | 1,715 | 1,311 | 1,133 | 987 | 919 |
| = Real free cash flow | 9,740 | 10,449 | 10,988 | 7,476 | |
| Free cash flow — the company's own count | 14,700 | 12,700 | 11,200 | 9,300 |
What does an investor pay for IBM today?
| Today (Oct 13, 2026) | |
|---|---|
| Share price | 227.02 |
| Market value (calculated) | 213,883.35 |
| Enterprise value (calculated) | 267,738.35 |
| P/E, last 12 months (calculated) | 20.2x |
| Price to book (calculated) | 6.2x |
| Real free cash flow yield (calculated) | 4.6% |