Business Corpus: What To Expect When IBM Reports Third-Quarter EarningsIBM earnings arrive Tuesday, with expectations for flat revenue growth as the company keeps a sharp focus on new business initiatives. The post What To Expect When IBM Reports Third-Quarter Earnings appeared first on Investor's Business Daily.

[Collection]

IBM (IBM) earnings are set to arrive after the market close Tuesday, with expectations for flat revenue growth as the company keeps a sharp focus on new business initiatives.

The consensus estimate for the third-quarter looks for IBM to post revenue of $19.1 billion. That compares with $19.15 billion in the year-ago period. The consensus on adjusted earnings per share is $3.39, up 3%.

IBM has been undergoing a business transition for several years, focusing on cloud computing, data analytics, mobile technology, social media and security. The collection of new business units is what IBM refers to as strategic imperatives.

During the multiyear transition, IBM revenue growth slowed quarter after quarter. Revenue growth finally resumed when IBM reported fourth-quarter results last year.

In the previous quarter, the IBM earnings report beat the consensus estimates on the top and bottom lines.

Bullish Stance On IBM Earnings

Nomura analyst Jeffrey Kvaal retained a bullish stance on IBM. In a report to clients Friday he kept a buy rating on the stock and price target of 170.

Shares of IBM were near 139.50, up a fraction during afternoon trading on the stock market today.

"Strong IT spending, continued cloud growth, and improving backlog should keep IBM's trajectory on track," Kvaal wrote. "A stronger dollar does pressure revenue growth, although we expect offsets from earlier restructuring."

KeyBanc Capital Markets analyst Arvind Ramnani in a research note Thursday said investor interest in IBM has incrementally increased with the recent stock pullback.

"Bulls are optimistic that third-quarter earnings will be driven by continued growth in strategic imperatives," Ramnani wrote. "Bulls are optimistic that revenue growth momentum from the second quarter will continue through the second half, driven by growth in strategic imperatives."

IBM expects revenue from strategic imperatives to reach $40 billion this year.

YOU MIGHT ALSO LIKE:

IBM Protests Pentagon Cloud Contract Worth $10 Billion

IBM Earnings Top Estimates As Turnaround Progresses

Analyst Upgrades IBM To Buy, Raises Price Target

Here's Why IBM Stock Fell Despite Its First-Quarter Earnings Beat

The post What To Expect When IBM Reports Third-Quarter Earnings appeared first on Investor's Business Daily.