CNBC Stock Blog

Expect a Good 2010 For IBM: Analyst

Dow component IBM is expected to report quarterly earnings after the bell on Tuesday. The firm added 55 percent to its share price over the past year. What should investors expect from the tech giant? Robert Cihra, analyst at Caris & Company, shared his insight.

Tech Check: IBM Preview

“IBM has held in remarkably well all throughout 2009, given how weak business spending had been,” Cihra told CNBC.

“IBM will have grown its earnings again in 2009 and I expect a pretty good 2010.”

Cihra said IBM has been getting leaner, cutting costs and focusing on the highest value parts of the market such as high-end software, services and hardware, and exiting most of the volatile markets such as PCs and disk drives.

“If you look back past over the past several years…IBM’s earnings will have been up from 2007 to 2010, almost 60 percent,” he said. “So that stability is worth a premium—yet IBM stock trades at a discount to the market.”

Additionally, Cihra said his favorite hardware play is Apple.

“The two of them [Apple and IBM] combined would be nice in a portfolio,” he said.

  • Watch Cihra's Previous Appearance on CNBC (Oct. 15, 2009)

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Cihra does not own shares of IBM, DELL, HPQ or IBM.