IBM's Growth Will 'Continue to be Difficult,' Deutsche Bank Says

On Thursday, Deutsche Bank initiated coverage on shares of International Business Machines

with a Hold rating and $200 price target. Analyst Sherri Scribner sees “hardware revenue to continue to be challenged, driving overall revenue down modestly in FY-14.” The analyst is modeling long-term growth in 1-2 percent range as growth will “continue to be difficult.” “Favorable product mix towards richer-margin software and services business, in combination with cost actions should support margin expansion, helping IBM near $20 in EPS in FY-15,” according to Scribner. The analyst believes the stock is fairly valued and will be “range bound.” Shares are up 0.57 percent to $197.80 in Thursday's trading.