valueyoda Posted February 3, 2015 Share Posted February 3, 2015 I am not saying that IBM is like HPQ in terms of product portfolio, but it is a famous example in the last few years of a tech value trap. IBM's free cash flow will dwindle in the coming two years, as competition for IBM's clients will heat up, without IBM being able to offer a comprehensive cloud computing service that allows them to maintain market share. Furthermore, IBM has to spend a lot of capital acquiring cloud computing and big data companies to get its service offering right. HPQ looked very cheap in 2011, but the underlying results were mainly supported by a lack of R&D investments and a large ongoing share buyback program. I think that as IBM's FCF declines, it will have a hard time supporting it with large buybacks. Link to comment Share on other sites More sharing options...
cubsfan Posted February 4, 2015 Share Posted February 4, 2015 http://spectrum.ieee.org/view-from-the-valley/at-work/tech-careers/massive-worldwide-layoff-underway-at-ibm Link to comment Share on other sites More sharing options...
Gamecock-YT Posted February 4, 2015 Share Posted February 4, 2015 I bet Ginny is going to be gone within 2 years. I wonder if Watson can be appointed CEO. ;D She's got the Augusta National membership, no need to stick around. Link to comment Share on other sites More sharing options...
tengen Posted February 5, 2015 Share Posted February 5, 2015 Sounds like a disaster in the making. I believe IEEE is a pretty credible source (I was a member long ago). Link to comment Share on other sites More sharing options...
KCLarkin Posted February 11, 2015 Share Posted February 11, 2015 This is a pretty good intro to IBM, especially if you want to understand their moat: http://analysisreport.morningstar.com/stock/research?t=IBM®ion=USA&culture=en-US&productcode=MLE Link to comment Share on other sites More sharing options...
RadMan24 Posted February 11, 2015 Share Posted February 11, 2015 http://spectrum.ieee.org/view-from-the-valley/at-work/tech-careers/massive-worldwide-layoff-underway-at-ibm ....you expect employees to be happy after being laid off? If IBM is to survive they need new skills and talents. That's capitalism, free markets, competition, etc. The press making a big stink of it is really a shame. Look at the facts, what would the charge be for 100,000 employees? Several billion dollars. If not tens of billions. Link to comment Share on other sites More sharing options...
Jurgis Posted February 11, 2015 Share Posted February 11, 2015 If IBM is to survive they need new skills and talents. And pray tell us what these new skills and talents might be? Link to comment Share on other sites More sharing options...
Palantir Posted February 13, 2015 Share Posted February 13, 2015 So now that IBM is at WEBs cost basis, can we expect an increased position? It would be curious if he were to reduce it. Link to comment Share on other sites More sharing options...
KCLarkin Posted February 17, 2015 Share Posted February 17, 2015 So now that IBM is at WEBs cost basis, can we expect an increased position? It would be curious if he were to reduce it. Probably. Link to comment Share on other sites More sharing options...
compoundinglife Posted February 17, 2015 Share Posted February 17, 2015 So now that IBM is at WEBs cost basis, can we expect an increased position? It would be curious if he were to reduce it. According to Dataroma it was filed today and increased 9.21%, haven't looked at the actual form. http://www.dataroma.com/m/holdings.php?m=brk Link to comment Share on other sites More sharing options...
kuberan Posted February 18, 2015 Share Posted February 18, 2015 I think Watsa has added to his position as well..... Link to comment Share on other sites More sharing options...
sleepydragon Posted February 18, 2015 Share Posted February 18, 2015 I think Watsa has added to his position as well..... me too ;D A lot of people still don't get IBM. 1. IBM's value is not creating the newest, best technology. It's a store front, an integrator, of the best technology for end users. IBM benefit both the end user and technology producers. 2. IBM's risk is low, as it does not depend on any single technology. 3. Unlike other tech firm, it's biggest R&D/"capital expenditure" is its hiring of sales people, who build relationships with clients. But it shows up as an cost on income statement. Save tax, and future benefits keep cumulating. 4. IBM's revenue is decline because they are pro-actively going away from selling products. Instead, they try to sell long-term service contracts. This takes time, but it's showing, and this is high quality earning. 5. Quantitatively, this is a company trading at less than 10x P/E, huge free cash flow, a lot of customers, not depending on any single technology, solid balance sheet, buying back stock, and lastly, one of Buffet's top 4 holdings. 6. nothing wrong for IBM to fire people. Many engineers at IBM are lazy, less entrepreneur. They have worked in the same company for the last 20 years. I have met some of them. They are smart, but they are not hungry, they are not driven, and they are only interested in working on google-like cool stuffs yet they don't work that hard. Nothing wrong to fire most of these people and hire someone else who's more motivated to solve client's problem. 7. IBM probabbly has the best sales force in the IT industry, other than perhaps EMC or Cisco. IBM is about 15% of my portfolio. Link to comment Share on other sites More sharing options...
Jurgis Posted February 18, 2015 Share Posted February 18, 2015 nothing wrong for IBM to fire people. Many engineers at IBM are lazy, less entrepreneur. They have worked in the same company for the last 20 years. I have met some of them. They are smart, but they are not hungry, they are not driven, and they are only interested in working on google-like cool stuffs yet they don't work that hard. Nothing wrong to fire most of these people and hire someone else who's more motivated to solve client's problem. LOLZ. Yeah, go ahead find hungry engineers who will work for the dinosaur IBM. Good luck. Nobody young, smart and hungry will go to work for them. Maybe for Watson sub if they are not treated like IBM-serf there. You talk as if it's the hirer's (employer's) market. It's not. It's the employee (engineers') market and they can get much better jobs than IBM. Link to comment Share on other sites More sharing options...
gurpaul88 Posted February 18, 2015 Share Posted February 18, 2015 Eddie Lampart buys IBM ~1.6% position Link to comment Share on other sites More sharing options...
dwy000 Posted February 18, 2015 Share Posted February 18, 2015 nothing wrong for IBM to fire people. Many engineers at IBM are lazy, less entrepreneur. They have worked in the same company for the last 20 years. I have met some of them. They are smart, but they are not hungry, they are not driven, and they are only interested in working on google-like cool stuffs yet they don't work that hard. Nothing wrong to fire most of these people and hire someone else who's more motivated to solve client's problem. LOLZ. Yeah, go ahead find hungry engineers who will work for the dinosaur IBM. Good luck. Nobody young, smart and hungry will go to work for them. Maybe for Watson sub if they are not treated like IBM-serf there. You talk as if it's the hirer's (employer's) market. It's not. It's the employee (engineers') market and they can get much better jobs than IBM. CEO commented in that interview that someone posted a couple of pages back that for 1000 intern positions last year they got 1,000,000 applications. Doesn't speak to quality of course but they can still attract some interest. Link to comment Share on other sites More sharing options...
Jurgis Posted February 18, 2015 Share Posted February 18, 2015 CEO commented in that interview that someone posted a couple of pages back that for 1000 intern positions last year they got 1,000,000 applications. Doesn't speak to quality of course but they can still attract some interest. If you listen carefully, she never said "engineer". Although I agree that Watson sub and IBM research still attract interest and possibly even high quality interest. But that's very small part of the company. Link to comment Share on other sites More sharing options...
Phaceliacapital Posted February 19, 2015 Share Posted February 19, 2015 http://www.bloomberg.com/news/articles/2015-02-18/dude-where-s-the-shortest-beer-line-ibm-to-guide-atlanta-fans Fans who attend events at Atlanta’s new $1.2 billion stadium might find it easier to locate parking, find the shortest beer line or get a discount on merchandise because of technology being put in place by IBM. You can hate on the company all you want, but come on, this is important stuff! Link to comment Share on other sites More sharing options...
Jurgis Posted February 19, 2015 Share Posted February 19, 2015 http://www.bloomberg.com/news/articles/2015-02-18/dude-where-s-the-shortest-beer-line-ibm-to-guide-atlanta-fans Fans who attend events at Atlanta’s new $1.2 billion stadium might find it easier to locate parking, find the shortest beer line or get a discount on merchandise because of technology being put in place by IBM. You can hate on the company all you want, but come on, this is important stuff! IBM longs win... how can anybody have an argument against the shortest beer line. This is revolutionary! Buy, buy, buy! The beer first, the stock... maybe after. 8) ;D ;D ;D Link to comment Share on other sites More sharing options...
TwoCitiesCapital Posted February 19, 2015 Share Posted February 19, 2015 http://www.bloomberg.com/news/articles/2015-02-18/dude-where-s-the-shortest-beer-line-ibm-to-guide-atlanta-fans Fans who attend events at Atlanta’s new $1.2 billion stadium might find it easier to locate parking, find the shortest beer line or get a discount on merchandise because of technology being put in place by IBM. You can hate on the company all you want, but come on, this is important stuff! It sure is - What about using something similar to guide traffic to different routes to keep congestion low? This would increase productivity across the city, decrease wait time for individual drivers, lower fuel consumption, and save time. That would be a big deal! How about using this technology to guide customers to the shortest line at a busy grocery/retail store? This can be a difficult task, especially on days like Black Friday, but this technology could help more efficiently manage the flow. Obviously this was posted sarcastically, but the benefits of this type of technology extend far beyond beer lines. To be fair though, I jumped on the bandwagon this week and bought a small position simply because Buffett added over the quarter. I don't know enough about this industry to have any clue where IBM is going, but I do like that Buffett seems to be maintaining his confidence. The position is small though - the same as what I do for my other speculative ventures. Link to comment Share on other sites More sharing options...
sleepydragon Posted February 20, 2015 Share Posted February 20, 2015 nothing wrong for IBM to fire people. Many engineers at IBM are lazy, less entrepreneur. They have worked in the same company for the last 20 years. I have met some of them. They are smart, but they are not hungry, they are not driven, and they are only interested in working on google-like cool stuffs yet they don't work that hard. Nothing wrong to fire most of these people and hire someone else who's more motivated to solve client's problem. LOLZ. Yeah, go ahead find hungry engineers who will work for the dinosaur IBM. Good luck. Nobody young, smart and hungry will go to work for them. Maybe for Watson sub if they are not treated like IBM-serf there. You talk as if it's the hirer's (employer's) market. It's not. It's the employee (engineers') market and they can get much better jobs than IBM. IBM doesn't need to hire the best engineers. It's no longer a technology builder, no longer a product driven company. it simply needs to act like a facilitator of selecting and transferring the best technology to the IT end users. Apple has to kiss IBM's ass to get their ipad to corporate users. Same as Facebook. Same as many startups in the valley. IBM get to pick which one. It's IBM's huge moat. The cloud thing is a huge thing for companies like IBM, MSFT, SYMC. It used to be that you buy a product and then you decide whether you want to upgrade. Now, you are "always" upgrading, because now you are leasing, you are paying by the month. And it's extremely sticky once you start using cloud-based software. Because you probably saved all your data in the cloud too. And you want to use the software from established company due to security reasons, where you will feel safe to put your stuffs at. And for IBM, they sign these 20-year contracts with companies. It's very stable income. And I suspect the best paid people in IBM is likely sales people, or "system engineers" (they are really the sales people who pretend to be engineers. The CEO was in this role), not a software or hardware developer. WEB has said before that he didn't understand technology. I think the reason he is so deep in IBM is because you really don't need to understand technology to buy IBM, and the fact that WEB know his limitation of understanding technology and yet still bought IBM indicate to me that he has considered a very large margin of safety. Link to comment Share on other sites More sharing options...
sleepydragon Posted February 20, 2015 Share Posted February 20, 2015 http://www.bloomberg.com/news/articles/2015-02-18/dude-where-s-the-shortest-beer-line-ibm-to-guide-atlanta-fans Fans who attend events at Atlanta’s new $1.2 billion stadium might find it easier to locate parking, find the shortest beer line or get a discount on merchandise because of technology being put in place by IBM. You can hate on the company all you want, but come on, this is important stuff! It sure is - What about using something similar to guide traffic to different routes to keep congestion low? This would increase productivity across the city, decrease wait time for individual drivers, lower fuel consumption, and save time. That would be a big deal! How about using this technology to guide customers to the shortest line at a busy grocery/retail store? This can be a difficult task, especially on days like Black Friday, but this technology could help more efficiently manage the flow. Obviously this was posted sarcastically, but the benefits of this type of technology extend far beyond beer lines. Think GM is doing something like that for the next generation of cars. Link to comment Share on other sites More sharing options...
sleepydragon Posted February 24, 2015 Share Posted February 24, 2015 http://blogs.wsj.com/cio/2015/02/23/ibm-angles-to-be-cloud-coordinator/?mod=WSJ_hps_sections_cio Link to comment Share on other sites More sharing options...
KCLarkin Posted March 2, 2015 Share Posted March 2, 2015 Buffett on IBM (CNBC): http://www.cnbc.com/id/102464032 Link to comment Share on other sites More sharing options...
KCLarkin Posted March 2, 2015 Share Posted March 2, 2015 IBM 2015 Investor Briefing: http://edge.media-server.com/m/p/2zgq5vxk Link to comment Share on other sites More sharing options...
LowIQinvestor Posted March 10, 2015 Share Posted March 10, 2015 From Investor Briefing, IBM is targeting high single digit annual EPS growth. I guess people don't want to pay more than a high single digit PE ratio for IBM. Still think people are underestimating IBM's push into cognitive computing and the launching of Watson as an ecosystem. Full Disclosure: I keep buying IBM in the $150s. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now