We remarked at the time that Oppenheimer & Co downgrade of IBM Corp’s 1992 earnings per share forecast to $7 from $7.50 a week or so back still looked optimistic and Smith Barney Harris Upham & Co thinks so too: IBM’s shares were off $1.375 at $92.75 in early trading yesterday after the broker’s Barry Bosak cut his estimate for 1992 to $5.80 from $6.85 and his 1993 estimate to $8.50 from $10.50 and reduced his recommendation to hold from buy; he said that IBM’s second quarter figures showed that personal computers were largely to blame for gross margin pressure but We think there is creeping pressure in other hardware areas, including mainframes – witness our story on today’s front page; We believe IBM is attempting to gain or hold market share in certain key areas like disks, mainframes and minicomputers and can tell by other companies’ reports that there is pain in the field; in reality there is considerable pain at IBM and it might be worsening in terms of gross margin pressure, the analyst commented.
