IBM Corp (NYSE: IBM) is down a little under 10% on Thursday after the computer hardware company reported yet another miss on revenue last night, and Ritholtz Wealth Management’s Josh Brown says now is as good a time as any to sell the stock.
Brown’s reasons to sell IBM stock
On CNBC’s “Halftime Report”, Brown blasted the stock saying he couldn’t find anything good to say about it.
Declining revenue for ten years. This company failed to figure out how to turn this battleship in a decade. The stock has been in a downtrend since March of 2013. It’s been going in the opposite direction of pretty much every technology stock in existence and the overall market since March of 2013.
His outlook is aligned with Morningstar’s Julie Bhusal Sharma, who also dubbed the stock “overvalued” after IBM reported its financial results for the third quarter.
Jim Chanos: IBM is overstating its earnings
Earlier this week, Kynikos Associates founder Jim Chanos warned that IBM was overstating its earnings by 50%. If he’s right, Brown added, the stock could slide further, which is why it would be a smart move to get out of it now.
I understand the value guys like it cause it’s cheap. But it’s been cheap, and it’s getting cheaper. I don’t think this brand is on the verge of resurrecting itself.
IBM’s GAAP earnings on a per-share basis also fell shy of Wall Street estimates in the fiscal third quarter.
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