Earnings Preview to Big Blue

CNBC is reporting that options activity is expecting a 3% move up or down given the number of $195 straddles being placed today…

“SAN FRANCISCO (MarketWatch) — International Business Machines Corp. is expected to post a gain in fourth-quarter earnings despite flat revenues when it reports its results on Tuesday afternoon.

This may help Big Blue gain its way back into investors’ good graces. IBM’sIBM +0.23% shares took a hit in October, after the company reported a rare earnings decline after revenue fell across the company’s key segments. The stock is down about 8% since the last report, having closed at a record high of $211 immediately prior.

Sentiment on Wall Street is mixed on the tech giant, with slightly more than half the covering brokers rating the stock as a neutral.

“Investors have held to the notion that IBM can protect earnings through sluggish times, which was somewhat called into question based on last quarter’s in line earnings,” wrote Joseph Foresi of Janney Capital in a note on Friday.

For the fourth quarter, analysts expect IBM to post earnings of $5.25 per share on revenue of $29.1 billion, according to consensus forecasts from FactSet. That compares with earnings of $4.71 per share on revenue of $29.5 billion for the same period last year….”

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