IBM May Report Lower Backlog in Q4

January 9, 2012 9:15 AM EST

International Business Machines Corp. (NYSE:IBM) may report lower backlogs for its fourth quarter, hurt by challenging business conditions at its software and systems units.

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BMO Capital Markets analyst Keith Bachman said IBM faces a tough compare of $22.1 billion for December quarter bookings in reported amounts. Moreover, the analyst said IBM will need to sign more than $21 billion in reported bookings to have backlogs remain flat on a year-over-year basis, which is at the top end of the analyst's expected range.

"Net, we believe that reported bookings will be in the range of $19-$21 billion in the Dec 2011 Q, so we think there is a chance that IBM's backlog will decline on a y/y basis, after backlog declined on a q/q basis in the Sept 2011 quarter," Bachman wrote in a note to clients.

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Bachman, who has a "market perform" rating on IBM shares, also lowered IBM's calendar year 2012 revenue estimate to $108.9 billion from $110.7 billion and earnings per share view to $14.78 from $14.85. Wall Street expects IBM to earn $14.84 a share on revenue of $110.24 billion for 2012, according to analysts polled by Thomson Reuters.

Shares of IBM closed Friday's regular trading session at $182.54 on the New York Stock Exchange.

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