Herb Greenberg: IBM simply disclosed too much

Pedestrians walk past IBM's building in New York.
Craig Warga | Bloomberg | Getty Images

I've never been a fan of companies giving guidance, let alone five-year earnings per share targets.

Yet that's been part of the IBM story for at least five years, as the company has dangled a five-year "roadmap" with a $20 operating earnings per share target in front of investors' noses.

As I wrote today on TheStreet.com, it's not that the company can't get there, it's that once it gives a big number years out, it's under pressure to make that number—no matter what.

(Read more: IBM earningsbeat estimates, revenue comes in light)

Beware managed earnings: Greenberg

In the past, I've questioned IBM execs about the wisdom of such a long-term target, and they proudly showed off their colorful charts and graphs on how they expected to get there. This much would come from share buybacks. This much from a catch-all known as "operating leverage," a.k.a layoffs. And this much from future acquisitions.

It looked good on paper but ... it's one thing for a company to have an internal long-term plan; it's another to lay it out for investors, down to the penny.

In all of my years of doing this, I never quite understood why or how any company could claim to see that far out.

Now we know—they can't.

—CNBC Contributor Herb Greenberg is a commentator at TheStreet.com and editor of Herb Greenberg's Reality Check. Follow him on Twitter: @herbgreenberg and Google.

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