International Business Machines (IBM)
International Business Machines Corporation (IBM) is an American multinational technology company headquartered in Armonk, New York, with operations in over 170 countries. The company began in 1911, founded in Endicott, New York, as the Computing-Tabulating-Recording Company (CTR) and was renamed International Business Machines in 1924. IBM is incorporated in New York. IBM produces and sells computer hardware, middleware and software, and provides hosting and consulting services in areas ranging from mainframe computers to nanotechnology. IBM is also a major research organization, holding the record for most annual U.S. patents generated by a business (as of 2020) for 28 consecutive years. Inventions by IBM include the automated teller machine (ATM), the floppy disk, the hard disk drive, the magnetic stripe card, the relational database, the SQL programming language, the UPC barcode, and dynamic random-access memory (DRAM). The IBM mainframe, exemplified by the System/360, was the dominant computing platform during the 1960s and 1970s.
Stock Price Trends
Stock price trends estimated using linear regression.
Key facts
- The primary trend is increasing.
- The growth rate of the primary trend is 58.80% per annum.
- IBM price at the close of April 26, 2024 was $167.13 and was lower than the bottom border of the primary price channel by $8.33 (4.75%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 44.33% per annum.
- IBM price at the close of April 26, 2024 was lower than the bottom border of the secondary price channel by $10.53 (5.92%).
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of IBM price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: March 9, 2023
End date: April 24, 2024
a = 2.9444
b = 0.0013
s = 0.0440
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0013) – 1
= 58.80%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0440) – 1
= 19.23%
March 9, 2023 calculations
Top border of price channel:
Exp(Y973)
= Exp(a + b × X973 + 2 × s)
= Exp(a + b × 1,410 + 2 × s)
= Exp(2.9444 + 0.0013 × 1,410 + 2 × 0.0440)
= Exp(4.8188)
= $123.81
Bottom border of price channel:
Exp(Y973)
= Exp(a + b × X973 – 2 × s)
= Exp(a + b × 1,410 – 2 × s)
= Exp(2.9444 + 0.0013 × 1,410 – 2 × 0.0440)
= Exp(4.6429)
= $103.85
April 24, 2024 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,822 + 2 × s)
= Exp(2.9444 + 0.0013 × 1,822 + 2 × 0.0440)
= Exp(5.3408)
= $208.67
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,822 – 2 × s)
= Exp(2.9444 + 0.0013 × 1,822 – 2 × 0.0440)
= Exp(5.1649)
= $175.02
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 58.80% per annum.
- IBM price at the close of April 26, 2024 was $167.13 and was lower than the bottom border of the primary price channel by $8.33 (4.75%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: March 6, 2024
End date: April 24, 2024
a = 8.1270
b = -0.0016
s = 0.0099
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0016) – 1
= -44.33%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0099) – 1
= 4.04%
March 6, 2024 calculations
Top border of price channel:
Exp(Y1,222)
= Exp(a + b × X1,222 + 2 × s)
= Exp(a + b × 1,773 + 2 × s)
= Exp(8.1270 + -0.0016 × 1,773 + 2 × 0.0099)
= Exp(5.3013)
= $200.59
Bottom border of price channel:
Exp(Y1,222)
= Exp(a + b × X1,222 – 2 × s)
= Exp(a + b × 1,773 – 2 × s)
= Exp(8.1270 + -0.0016 × 1,773 – 2 × 0.0099)
= Exp(5.2617)
= $192.81
April 24, 2024 calculations
Top border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 + 2 × s)
= Exp(a + b × 1,822 + 2 × s)
= Exp(8.1270 + -0.0016 × 1,822 + 2 × 0.0099)
= Exp(5.2226)
= $185.42
Bottom border of price channel:
Exp(Y1,256)
= Exp(a + b × X1,256 – 2 × s)
= Exp(a + b × 1,822 – 2 × s)
= Exp(8.1270 + -0.0016 × 1,822 – 2 × 0.0099)
= Exp(5.1831)
= $178.23
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 44.33% per annum.
- IBM price at the close of April 26, 2024 was lower than the bottom border of the secondary price channel by $10.53 (5.92%).