How Long IBM Stock Could Stay Underwater - Trefis

What the report says

Trefis reported on July 24, 2026, that IBM shares have dropped about 22% in the past month and are trading roughly 37% below their 52-week high, putting renewed focus on how long investors might have to wait for a recovery. The analysis said the selloff followed second-quarter results that management described as below expectations, along with a cut to full-year revenue growth guidance to 4% to 5%. IBM remains a major enterprise technology provider, with businesses spanning hybrid cloud, watsonx artificial intelligence offerings and mainframe systems.

Using historical market-shock data, Trefis said IBM’s average peak-to-trough decline across 15 major disruptions was 16%, about the same as the S&P 500 during those episodes. Its steepest cited shock-related fall was 37% during the 2020 market crash. The analysis also noted that recovery times have varied widely: among shocks from which IBM fully recovered, the median time to regain the prior high was about five months, while the longest example cited was roughly 108 months after the 2013 “taper tantrum.”

Trefis said IBM’s current business mix may offer more resilience than in earlier periods, pointing to software representing nearly 45% of revenue and management’s statement that about 80% of annual software revenue is recurring. It also cited strength in the z17 mainframe refresh cycle. However, the report cautioned that the recent earnings disappointment and delayed large deals show IBM remains exposed to shifts in enterprise spending.

The piece framed the issue as a portfolio-risk question, arguing that position size and diversification matter because a large single-stock drawdown can have an outsized effect on overall returns.