Tuesday, April 29, 2003

Barron's Online - Think Twice About IBM's Earnings

Barron's Online - Think Twice About IBM's Earnings "The world's largest computer company announced that income from operations rose by 8% and that revenue topped Wall Street's estimates. It also reiterated its outlook for this year's earnings.
And though first-quarter earnings per share came in a penny below Wall Street's estimates, the stock hovers near a 52-week high.
But IBM, which under former chairman and chief executive officer Louis V. Gerstner, Jr., was dogged by accusations it used gimmicks and accounting tricks to dress up its earnings, still appears vulnerable to that criticism.
Examined more closely, IBM's revenues actually declined during the quarter from the same period a year ago -- and earnings again were pumped up by one-time gains."

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