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IBM (IBM) is scheduled to report results of its fiscal fourth quarter after the market close on January 25, with a conference call scheduled for 5:00 pm ET. What to watch for:

GUIDANCE: Along with its last report, IBM guided for fiscal 2022 constant currency revenue growth above the mid-single digit model. At the time, analysts were expecting the company to report FY22 revenue of $59.82B, but that figure has since risen to $60.22B. Meanwhile, IBM said on its quarterly call that it expected strong free cash flow performance in Q4, noting that currency translation would be an eight to nine-point headwind in the quarter.

STIFEL UPS PRICE TARGET: Earlier this week, Stifel analyst David Grossman raised the firm's price target on IBM to $158 from $140 and kept a Buy rating on the shares. IBM has outperformed the S&P 500 over the trailing 12 months and the past three months noted the firm, which argues that execution should continue to improve going into 2023 as newer programs better leverage channel partnerships, align go-to-market strategies, and prioritize growth. Continued macro uncertainty is "likely the primary driver of near-term performance," said the Stifel analyst, whose positive bias assumes continued operational improvements and current economic uncertainty position IBM as "a safe haven".

MOFFETT UPGRADE: Last week, MoffettNathanson analyst Lisa Ellis upgraded IBM to Market Perform from Underperform with a $140 price target. The firm's most recent CIO survey, which was released two weeks ago, pointed toward continued strong demand for IT Services in 2023, said Ellis, who is "increasingly convinced that we are amid a once-in-a-generation step-up in the 'IT intensity' of corporations" driven by the Digitization trends.

MORGAN STANLEY DOWNGRADE: On January 18, Morgan Stanley analyst Erik Woodring downgraded IBM to Equal Weight from Overweight with a price target of $148, down from $152. While he upgraded his IT Hardware industry view to "In-Line" from "Cautious" as the final stage of late-cycle transitions to an early cycle rebound, Woodring said he expects demand weakness to persist into the first half. The firm's downgrade of IBM is part of starting to transition away from defensive names, towards more transactional, early cycle beneficiaries, Woodring explained.

EVERCORE UPS PRICE TARGET: Meanwhile, Evercore ISI analyst Amit Daryanani last week raised the firm's price target on IBM to $150 from $135 and keeps an In Line rating on the shares. The analyst, who added shares to the Tactical Outperform List, thinks IBM is well-positioned to report December quarter results that are ahead of Street expectations while guiding to upside vs. consensus CY23 expectations, Daryanani tells investors in a research note.

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