2. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 43
Dividend Yield as of June 2: 4.73%
Hourglass Capital’s Stake Value: $5,751,000
International Business Machines Corporation (NYSE:IBM) is an American multinational tech company, having operations in over 171 countries. In May, the company signed an agreement with Amazon Web Services (AWS), offering its software catalog on AWS. This partnership will allow clients to have quick and easy access to IBM software.
In April 2022, International Business Machines Corporation (NYSE:IBM) declared a 0.6% growth in its quarterly dividend, which marked the company’s 27th consecutive year of dividend growth. Moreover, the company has paid consecutive quarterly dividends since 1916. As of June 2, the stock’s dividend yield came in at 4.73%.
As International Business Machines Corporation (NYSE:IBM) reported a 13% year-over-year growth in its Consulting revenue in Q1 2022, BMO Capital, in April, raised its price target on the stock to $152, with a Market Perform rating on the shares.
At the end of Q1 2022, Hourglass Capital held shares worth over $5.7 million in International Business Machines Corporation (NYSE:IBM), accounting for 1.79% of Kenneth A. Moffet’s portfolio. The hedge fund first invested in the company during the first quarter of 2016 with 30,150 shares, worth $4.36 million.
According to Insider Monkey’s Q1 2022 data, 43 hedge funds held stakes in International Business Machines Corporation (NYSE:IBM), valued at over $1.16 billion. In comparison, 44 hedge funds held positions in the company in the previous quarter, with stakes valued at roughly $1.3 billion.
St. James Investment Company mentioned International Business Machines Corporation (NYSE:IBM) in its Q4 2021 investor letter. Here is what the firm has to say:
“IBM was not the first company to build computers. The distinction belongs to Sperry-Rand’s subsidiary UNIVAC, which introduced the first commercially successful computers in the early 1950s. In this era, IBM did possess the largest research and development department of the business machines industry and quickly caught up, introducing cost-competitive computers a few years after UNIVAC. By the late 1950s, IBM held the dominant market share in computers. IBM also touted a vastly superior sales organization, which used a sales tactic called “paper machines” (the equivalent of today’s “vaporware”). If a competitor’s product was selling well in a market segment that IBM had yet to penetrate, the company would announce a competing product and start taking orders for the “paper machine” long before it was available.
One cannot overstate how powerful IBM was in the computer industry in the 1950s and 1960s. Every competitor rightly worried that if their product worked too well for too long, it was only a matter of time before an army of IBM salesforce representatives mobilized. In their easily recognizable uniforms of starched white shirts, red ties and blue suits, IBM marketers marched on their customers and offered a more expensive, but much more defensible, choice. “Nobody gets fired for buying IBM” was a common phrase. Even competitors acknowledged that the company excelled at sales. As a UNIVAC executive once complained, ‘It doesn’t do much good to build a better mousetrap if the other guy selling mousetraps has five times as many salesmen.’” (Click here to see the full text)
