International Business Machines Corporation (IBM) has inked a 5-year agreement with Honda Motor Europe to manage Honda’s finance and procurement operations across Europe. The recent contract marks an extension to an existing ten-year relationship with Honda.
Shares of the multinational technology giant headquartered in New York have gained 17% over the past year. (See IBM stock charts on TipRanks)
Per the terms of the agreement, IBM will provide integrated end-to-end services and enable the standardization and simplification of processes, bringing cost savings, higher productivity, quality, and improved service levels to Honda’s suppliers and customers.
Dave Miller, Managing Director for Honda Global Account at IBM, said, “We look forward to bringing our business process experience, technology and transformation methodologies to help Honda Motor Europe bring its Zero Touch ambitions one step closer.”
Following the company’s Investor Day, Credit Suisse analyst Matthew Cabral recently increased his price target on IBM from $167 to $176 (23% upside potential) and reiterated a Buy rating.
Cabral believes that investors have underestimated IBM’s potential for growth in a hybrid-first world and that this potential has not yet been priced into the share price at current levels.
The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 3 Buys and 6 Holds. The average IBM price target of $157.44 implies that the stock has upside potential of 10% from current levels.
IBM scores an 8 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained about 13% over the past year.