# BMO Raises IBM Price Target to $265, Keeps Market Perform Rating By Enna Lee Canonical URL: https://www.tokenpost.com/news/investing/38787 Published: 2026-10-23T07:26:32.000Z Updated: 2026-10-23T07:26:32.000Z Section: Investing > The higher target follows IBM’s third-quarter revenue and earnings beat, while BMO flagged questions about the durability of software growth. BMO Capital raised its IBM stock target to $265 after the company beat third-quarter estimates, while its unchanged Market Perform rating reflected questions about the durability of software growth. On Thursday, Oct. 22, BMO lifted the target from $230, a $35 increase. The new level is about 5% above IBM’s $251.46 closing price from Wednesday, Oct. 21. IBM reported $17.1 billion in third-quarter revenue and adjusted earnings of $2.95 per share, beating estimates of $16.82 billion and $2.86. Revenue grew 5% year over year, or 6% when adjusted for currency changes. Software revenue reached $7.8 billion, up 8%. Transaction Processing grew 9%, and Red Hat advanced 11%, while Automation revenue declined 3%. Transactions that slipped into the quarter helped IBM’s overall results. BMO questioned whether that lift would persist without steadier software demand and viewed organic software growth as below IBM’s long-term target. It also estimated weakness in Data and Automation after excluding acquisitions. Consulting brought in $5.3 billion, roughly flat from a year earlier and up 2% at constant currency. Strategy and technology consulting recorded a modest increase. Infrastructure revenue totaled $3.7 billion, rising 4%; distributed infrastructure sales climbed 31%, while IBM Z revenue fell 20%. BMO attributed part of the infrastructure improvement to higher prices and sales volumes. Infrastructure support revenue declined 3%. IBM generated $3 billion in free cash flow during the quarter and raised its full-year outlook, expecting annual free cash flow to increase by more than $1 billion. It kept its 2026 revenue-growth view at 4% to 5% on a constant-currency basis. Stifel also raised its IBM price target to $260 after the quarterly results. TokenPost previously covered IBM’s [quarterly results and free-cash-flow outlook](). ## Links in this article - [quarterly results and free-cash-flow outlook](https://www.tokenpost.com/news/business/37697)