IBM has just been given a subtle yet significant acknowledgment by Wall Street. Evercore ISI has increased its price target on IBM to $330 from $315, while keeping the stock at Outperform rating. This again indicates the company’s growing confidence before the fourth quarter earnings.
IBM is all set to announce its results after the market closes on 28th January 2026, where its results are anticipated to be quite moderate. Evercore expects the company’s performance to be at or just above the consensus, which is currently $19.2 billion in revenue and $4.29 in earnings per share. In a market that requires huge upside surprises, it is quietly becoming a big deal to meet the promises that you made.
Mainframes, Consulting & Software
In the background, Evercore ISI’s optimism is based on a well-known, but trusted engine. The ongoing mainframe cycle is going to be a blessing for IBM’s Infrastructure segment, which is demonstrating that vintage hardware is still in the game. Also, the consulting area seems to be recovering and is giving a bit more balance to the tale.
On the other hand, the Software area is projected to record a growth rate of roughly 7% annually in constant currency terms, which is a goal that Evercore firmly believes to be realistic rather than just wishful thinking. To sum up, IBM’s overall business mix appears to be stable, diversified, and free of any unrealistic promises that do not reflect in the numbers.
Cutting Costs, Margins, and a Clear Sky for 2026
Evercore’s trust in IBM’s cost-cutting strategy is its another supporting factor, which is expected to provide around $4.5 billion in gross run-rate savings. The resulting operating efficiencies should lead to expanding pre-tax margins, and a possible earnings increase in the fourth quarter.
Looking further into the future, Evercore sees IBM’s 2026 initial guidance to be at the lower side of the mid-single-digit growth range, combined with a minimum of one percentage point pre-tax margin expansion, and around $15 billion free cash flow. It might not come across as exciting, but for the present market, the characteristics of predictability and cash generation are becoming more trending.
IBM’s Conservative Tale
The announcement made by IBM is significant on its own, but it also comes in a tech environment that is full of ambiguous signals. For example, Apple still manages to sell a lot of iPhones worldwide, specifically in China, and is about to roll out its Apple Creator Studio subscription service for early 2026.
At the same time, the analysts are divided over Apple’s profitability, with some cautioning about the hardware margins, while others refer to its strategic AI collaborations as long-term benefits. In this situation, IBM’s tale looks almost conservative, but that might be the very reason for its attractiveness. Rather than pursuing media coverage, IBM is investing in execution, being efficient, and growing in an enterprise-focused manner.
Bottom Line
Evercore ISI’s increased price target is an indication that IBM is gradually regaining investor confidence not through hype, but through consistency. With steady infrastructure demand, better consulting performance, achievable software growth, and a clear route to enhanced margins, IBM is no longer perceived as a legacy tech company who is trying to remain relevant, but as a business that is working calmly. If the next earnings report meets expectations, IBM’s calmness may continue to be a source of advantage.
