IBM Stock Is Down 21% in 3 Months. Here’s What Could Drive the Next Move

Key Takeaways:

• IBM shares fell after Q1 2026 results as investors focused on slower software growth and AI disruption concerns.
• IBM stock could reasonably reach $296 per share by December 2028, based on our valuation assumptions.
• This implies a total return of 27.9% from today’s price of $231, with an annualized return of 9.6% over the next 2.7 years.

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What Happened?

International Business Machines (IBM) sold off after Q1 2026 earnings because investors focused on software growth and AI risk. Reuters reported that IBM shares fell as slower revenue growth renewed concerns that AI could disrupt traditional software businesses. The selloff also hit other software names, showing the issue was sector-wide rather than only IBM-specific.

IBM still beat Q1 expectations, with revenue of $15.9 billion and adjusted earnings of $1.91 per share….