International Business Machines announced today that it will acquire Finland-based startup, Nordcloud, a European leader in cloud implementation, application transformation and managed services. The deal will strengthen IBM’s cloud migration and transformation capabilities.
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IBM (IBM) believes that the acquisition of Nordcloud “adds the kind of deep expertise that will drive our clients’ digital transformations as well as support the further adoption of IBM’s hybrid cloud platform.”
“Nordcloud’s cloud-native tools, methodologies and talent send a strong signal that IBM is committed to deliver our clients’ successful journey to cloud,” John Granger, Senior Vice President, Cloud Application Innovation and Chief Operating Officer, IBM Global Business Services, added.
Leading IT industry analysts estimate the market for cloud professional services will exceed $200 billion by 2024, and the acquisition of Nordcloud is the latest in IBM’s journey into the hybrid cloud space. (See IBM stock analysis on TipRanks)
BMO Capital analyst Keith Bachman reiterated his Hold rating on the stock two months ago, setting a price target of $138 (13% upside potential). Bachman stated that the “underlying business trends remain weak…patience will be required.” He also mentioned that IBM will have limited capital to do additional acquisitions at least until 2022.
Overall, consensus among analysts is a Moderate Buy based on 2 Buys and 5 Holds. The average price target of $144.33 implies an upside potential of around 18% over the next 12 months.
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