This famous quote from the well know movie Field of Dreams pretty much sums up why I invested in IBM (NYSE:IBM). As I have mentioned in other articles, I focus less on charts, numbers and analyst reports to decide which stocks I want to buy than the average guy on SA. Not to say I don’t use them at all. As a value investor I look for solid companies which are, in my opinion, undervalued by the market. It is, however, the 2nd and 3rd mantras that Ray Kinsella hears in the 1989 movie that I really think are important. In this article, I will discuss those quotes, how IBM cloud is superior, (in some ways), to Amazon (NASDAQ:AMZN) AWS and I will discuss how Ginny Rometty fits in.
CLOUD, “If You Build It”
Consider these facts:
Cloud now accounts for 21 percent of IBM’s revenues (up from 10 percent just four years ago).
IBM’s “as-a-service” annual exit run rate was $10.3 billion, up 24 percent YTY.
10 largest global banks, nine of the top 10 retailers, and eight of the top 10 airlines are already turning to IBM for cloud solutions.
Jefferies recently named IBM as #3 in the total cloud market with annualized revenue and market share.
It is apparent from the info above that IBM is focusing on enterprise cloud solutions. That is, after all, where the money is.