10 Best Performing Dow Stocks in 2024

04. International Business Machines Corporation (NYSE:IBM)

Year to date Share Price Gain: 35.27%

Number of Hedge Fund Holders: 54

International Business Machines Corporation (NYSE:IBM) has been a strong performer in 2024, with a year-to-date share price gain of 35.27%. This rise can be attributed to the company’s solid financial performance and strategic advancements in the fields of AI and hybrid cloud solutions. As of Q2 2024, IBM was held by 54 hedge funds, an increase from 49 in the previous quarter, showcasing growing investor confidence in the stock.

In Q2 2024, IBM exceeded market expectations with an earnings per share (EPS) of $2.43, compared to the anticipated $2.18. The company’s revenue for the quarter stood at $15.8 billion, representing a 4% increase year-over-year. This growth was largely driven by the strong performance of its Software and Infrastructure segments, which reported 8% and 3% revenue increases, respectively. IBM’s success in these segments underscores the effectiveness of its investments in innovation, particularly within the realms of hybrid cloud and AI.

International Business Machines Corporation (NYSE:IBM) AI and hybrid cloud strategies have become crucial revenue drivers, particularly through its generative AI platform, watsonx. This AI-powered platform has been integrated across various business segments, and its contribution to IBM’s AI-related business now exceeds $2 billion. The company’s emphasis on smaller, fit-for-purpose AI models, such as the Granite family of models, highlights IBM’s focus on cost-effective and customizable AI solutions, setting it apart in the competitive tech landscape.

Additionally, IBM has expanded its AI and automation portfolio with the acquisition of Apptio, which has strengthened its position in FinOps (financial operations) and automation. This acquisition is already reflecting positively on IBM’s annual recurring revenue (ARR), which grew to $14.1 billion, up 9% year-over-year.

International Business Machines Corporation (NYSE:IBM) free cash flow generation also reached new heights, with $4.5 billion reported for the first half of 2024, up $1.1 billion from the same period last year. This growth was primarily driven by strong EBITDA performance and effective capital expenditure management. With a robust liquidity position of $16 billion in cash and a solid balance sheet, IBM is well-positioned to continue its growth trajectory.

In conclusion, International Business Machines Corporation (NYSE:IBM) strategic focus on AI, hybrid cloud solutions, and operational efficiency has laid a solid foundation for sustained growth. With continued investments in innovation and strong financial results, International Business Machines Corporation (NYSE:IBM) remains an attractive option for investors seeking exposure to a leading technology company with a diverse business model.