Shares of IBM are trading up 7.7% in pre-market action, reaching approximately $320.81 after Barclays initiated coverage on the company with a bullish rating.
- Barclays began its coverage with an Overweight rating and a $350.00 price target, citing the growing importance of IBM's software business, which generates the majority of its profits.
- The positive sentiment is amplified by a broader market rotation into legacy technology companies benefiting from enterprise AI spending, a trend supported by Dell's blowout earnings and strong AI server guidance last week.
- This continues a powerful rally for the stock, which has surged over 40% recently, largely driven by the late-May announcement of a major investment in quantum computing backed by a $1 billion grant from the U.S. government.