According to the Wise Finance APP, IBM (IBM.US) received a buy rating from Stifel on the eve of the upcoming Q3 financial report, earlier this week the stock closed at a historical high. Stifel also raised IBM's target price from $205 to $246. In addition, despite Stifel's forecast that IBM's revenue will be lower than the previous quarter due to seasonal factors, earnings per share may exceed expectations. IBM closed at a record high of $235.26 on Monday, continued to surge on Tuesday, hitting a new high of $237.37 intraday.

IBM will announce its financial performance for the third quarter of 2024 after the market closes on October 23rd. Analysts generally expect revenue to be $15.06 billion, with adjusted earnings per share at $2.22. In the previous quarter, IBM's earnings per share exceeded expectations by $0.26, while revenue exceeded by $0.147 billion.

Looking ahead to 2025, Stifel believes that IBM's recent acquisitions and new mainframe cycle will drive IBM's revenue growth.

IBM is expected to complete the $6.4 billion acquisition of HashiCorp (HCP.US) in the fourth quarter of 2024, but regulatory reviews may delay this transaction until early 2025. On July 1st, IBM completed the acquisitions of StreamSets and webMethods from Software AG for $2.1 billion.

Stifel predicts that by 2025, these acquisitions will increase IBM's software division revenue by 4% or more. The investment institution also believes that IBM will benefit from enterprise license renewals in 2025, especially in the fourth quarter. More importantly, IBM's next mainframe cycle is expected to start in the first half of 2025.

Stifel analysts led by David Grossman stated in an investor report: "IBM's previous mainframe cycle was launched with z16 in the second quarter of '22." "Mainframe cycles typically last 10-12 quarters, and we expect the next cycle to begin in the first half of 2025."

"The segmented report is not as detailed," he added. "However, historically the mainframe cycle has added approximately $1.5 billion in revenue to the infrastructure sector in the first 12 months."

IBM's stock price surged 67% in the past year, reaching new highs repeatedly in the past month.