IBM (NYSE:IBM) is a stock that I was bearish on for a long time. The company’s legacy businesses have been weak for years, and when it came to management, let’s just say I wasn’t exactly full of confidence. But in the past couple of quarters, IBM has shown some signs of life, and that led me to actually post a bullish piece on the stock after the Q3 report. That’s something I didn’t think I’d be doing in 2017 (or even 2018), but the facts have changed and thus, I have too. But despite the bullish talk of the SI businesses doing their part to grow revenue, IBM is still struggling with its margins, which is something I called out in my linked article as a principal risk the company needs to address. But how bad is it? In this article, using data from Seeking Alpha, I’ll take a look at IBM’s margin issues to see how bad they really are and if they could derail the bull argument.
Note: the charts below were all created by the author using data from the linked source above.
