5 Companies Set To Address DeepSeek AI Concerns In Earnings Calls Today

Page 4 of 4

1. International Business Machines Corporation (NYSE:IBM)

International Business Machines Corporation is a global integrated services and solutions provider that operates through financing, consulting, infrastructure, and software segments. When IBM reports its Q4 earnings later today, there will be multiple headwinds that analysts will have their eyes on. For example, the company is expected to report considerable forex pressure during the quarter and its guidance for growth in the Consulting segment may disappoint.

Software and AI business will more than cover for the headwinds though. IBM has been an underperformer for most of the last 10 years but things finally seem to be falling in place for the tech giant. The expected 14% YoY growth in operating income is a reflection of that improvement.

The stock is trading at 22 times forward earnings and about 14 times TTM free cash flow. At these valuations, the stock looks undervalued. Future developments in both AI and quantum computing are likely to improve the company’s valuations, though a lot of it will depend on what the company says about its 2025 plans at today’s earnings call.

IBM is not on our latest list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 56 hedge fund portfolios held IBM at the end of the third quarter which was 54 in the previous quarter. While we acknowledge the potential of IBM as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as IBM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap

Disclosure: None. This article was originally published at Insider Monkey.

Page 4 of 4