Summary
IBM will report third quarter earnings after the close on Tuesday.
The short interest on the stock has jumped in recent weeks.
There is potential support just below the current price.
Over the last few years, International Business Machines (IBM) has had a rough go of it. The stock has been trending lower, the company’s sales and earnings have been stagnant, and the profitability measurements have been declining. This has caused some investors and analysts to lower targets on the stock.
IBM is set to announce earnings on Tuesday after the closing bell and the fundamentals, sentiment, and technical picture are suggesting there is little to gain from buying the stock ahead of the report.
As I expressed before, the earnings and sales have been stagnant in recent years. Over the last three years, earnings have actually declined at an average rate of 4% per year. The company did manage to grow earnings by 5% in the second quarter and analysts expect IBM to grow earnings by 4% in the third quarter.
