IBM Stock Surges Premarket: Barclays’ Fresh Bull Call Highlights Quantum Potential, Retail Eyes $400

• Barclays said its Overweight rating on IBM reflects that nearly half of the company's revenue and most of its profit come from software, a mix expected to grow further as software outpaces other segments. 
• The analyst expects IBM to deliver mid-single-digit organic revenue growth alongside continued margin expansion.
• IBM stock surged nearly 30% in May, clocking its best monthly performance in nearly 24 years.

Shares of International Business Machines Corp. (IBM) were up nearly 8% in Monday’s premarket trading amid growing optimism amid a new Wall Street analyst price target upgrade as well as last week’s announcement from the Trump Administration about its quantum computing investment.

Barclays initiated coverage on the company’s shares with an ‘Overweight’ rating and a price target of $350, indicating an upside potential of about 17.5% from its previous close, according to a report from Investing.com.

Meanwhile, retail investors are eyeing a surge to $400 amid the growing interest.

IBM Stock: Barclays Stance

Barclays said its Overweight rating on IBM reflects that nearly half of the company's revenue and most of its profit come from software, a mix expected to grow further as software outpaces other segments.

Analyst Raimo Lenschow noted, per the report, that IBM’s infrastructure software serves large, highly regulated enterprises, creating a sticky customer base unlikely to face significant disruption from AI.

The analyst expects IBM to deliver mid-single-digit organic revenue growth alongside continued margin expansion, supporting steady earnings growth while offering additional upside from its quantum computing initiatives.

Barclays also said that the combination of consistent growth and a valuation that remains reasonable relative to its prospects underpins its bullish stance on the stock.

IBM’s Quantum Advantage

The Armonk, New York-based company said last week that it would be investing more than $10 billion in quantum computing over the next five years as it targets the launch of a large-scale commercial quantum system by 2029.

The announcement comes shortly after the U.S. government unveiled a $1 billion government funding to the company last week to accelerate quantum computing development. In relation to that announcement, IBM pledged to contribute an additional $1 billion to establish a new spinout, Anderon, which will oversee the construction and operation of a quantum wafer fabrication facility.

IBM Stock: Retail Stance

On Stocktwits, retail sentiment around IBM shares was in the ‘extremely bullish’ territory at the time of writing amid ‘extremely high’ message volumes.

One user said, “400$ today mark my words.”

Another bullish user also predicted a price of $400.

A third bullish user predicted an even higher upside. “buy more shares before this explodes to 500$” they said.

IBM stock surged nearly 30% in May, clocking its best monthly performance in nearly 24 years.

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