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    The Bull Case For IBM (IBM) Could Change Following Verifiable Quantum Advantage Breakthroughs With Key Partners

    Simply Wall St·08/01/2026 11:27:05
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    • In late July 2026, IBM and partners including Algorithmiq, Qedma, and the University of Chicago reported multiple quantum computing breakthroughs, claiming quantum advantage on complex physics problems that classical supercomputers could not reliably solve and introducing new frameworks to verify results on IBM’s Heron-based systems.
    • Together, these experiments position IBM’s cloud-accessible quantum hardware and partner software as early scientific tools for trusted, beyond-classical computation, with potential relevance for materials science, cryptography, and high‑end enterprise workloads.
    • We’ll now examine how IBM’s newly claimed, verifiable quantum advantage with partners could reshape its investment narrative around AI, hybrid cloud, and quantum.

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    International Business Machines Investment Narrative Recap

    To own IBM today, you need to believe its hybrid cloud, AI, and mainframe franchises can offset deal timing hiccups and high leverage, while its early quantum wins stay a long-term technology story rather than a near term profit driver. The latest quantum announcements are impressive technically, but they do not materially change the key near term catalyst, which remains converting IBM’s large AI and consulting pipeline into closed, recurring software and services revenue, or the main risk of softer enterprise and public sector IT budgets.

    Among recent news, the University of Chicago collaboration on “sampling hard circuits with verifiably high fidelity” is most relevant. It ties IBM’s Heron-based quantum systems directly to its broader narrative around trusted computing for regulated clients, alongside watsonx and z17. If enterprises begin to see IBM’s quantum, AI, and mainframe stack as a unified, secure compute platform, that could reinforce the existing catalyst around hybrid cloud and AI adoption rather than replace it.

    Yet behind the quantum headlines, investors should be aware that IBM’s high debt load and the risk of slower cloud adoption relative to hyperscalers could...

    Read the full narrative on International Business Machines (it's free!)

    International Business Machines' narrative projects $79.6 billion revenue and $12.7 billion earnings by 2029. This requires 4.9% yearly revenue growth and about a $2.0 billion earnings increase from $10.7 billion today.

    Uncover how International Business Machines' forecasts yield a $293.89 fair value, a 31% upside to its current price.

    Exploring Other Perspectives

    IBM 1-Year Stock Price Chart
    IBM 1-Year Stock Price Chart

    Some of the lowest ranked analysts were far more pessimistic, assuming IBM’s revenue would grow only about 3.9% a year and earnings dip toward roughly US$10.4 billion, so compared with the baseline narrative and the recent quantum news, you can see how views on IBM’s future profitability and competitive position can diverge sharply and may need to be revisited as these technical milestones start to be tested in real customer workloads.

    Explore 10 other fair value estimates on International Business Machines - why the stock might be worth as much as 41% more than the current price!

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.