12 Best Consulting Stocks to Buy According to Hedge Funds

2. International Business Machines Corporation (NYSE:IBM)

Number of Hedge Fund Investors: 60

International Business Machines Corporation (NYSE:IBM), one of the world’s largest IT services companies and Best Consulting stocks, continues to be the leading provider of mainframes while also expanding its consulting and software businesses by concentrating on digital transformation projects and hybrid cloud infrastructure. The firm has had to reinvent itself over the last few decades as its core mainframe business has confronted shifting industry dynamics. While the company has not always been recognized for being at the forefront of innovation, Morningstar analysts believe it has properly positioned itself to meet the demands of businesses seeking IT infrastructure upgrades, consulting services, and hardware. Its software offerings are used in hybrid cloud-focused initiatives, as well as consulting services to implement and support these projects. These projects can also operate on IBM-assisted hardware.

In 2024, International Business Machines Corporation (NYSE:IBM)’s revenue rose by 3%, while the business generated $12.7 billion in free cash flow, the highest in years. Software was a big driver, expanding by 9%, while RedHat had double-digit growth. Infrastructure revenues remained consistent, and while consulting revenue fell slightly short of Wall Street expectations, its investments in AI and partnerships are expected to drive future growth. Software currently accounts for 45% of the company’s business, with recurring revenue exceeding $15 billion. Q4 2024 was exceptionally strong, with 11% revenue growth, headed by RedHat’s 17% surge. The company’s generative AI business is also gaining traction, with total contracts worth $5 billion.

On January 28, International Business Machines Corporation (NYSE:IBM) declared a quarterly cash dividend of $1.67 per share, paid on March 10, 2025. This maintains the company’s record of regular dividend payments, which date back to 1916. The company has also increased its dividends for the past 29 years, making it one of the  Best Consulting Stocks.