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Monday, 01/20/2003

IBM - International Business Machines

Company Description

International Business Machines Corporation (IBM) manufactures and sells computer services, hardware and software. The Company also provides financing services in support of its computer business. The Company's major operations comprise a Global Services segment; three hardware product segments (Enterprise Systems, Personal and Printing Systems, and Technology); a Software segment; a Global Financing segment; and an Enterprise Investments segment. IBM offers its products through its global sales and distribution organizations. The Company operates in more than 150 countries worldwide and derives more than half of its revenues from sales outside the United States. In October 2002, the Company completed the acquisition of PC Consulting, the global management consulting and technology services unit of Price, Water, House and Coopers. In December 2002, the Company sold most of its hard disk drive operations to Hitachi Ltd., a global electronics company. (Source: IBM)

Reasons To Invest

IBM experts it will meet Wall Street estimates for earnings and revenue in the first quarter and, provided there is "modest , like most technology corporations, has been hurt by a two-year decline in technology spending as corporations have cut back on buying new computers and related technology. Recently, analysts have been divided about whether companies will increase their buying this year. IBM said that it believes that demand for technology is more stable now than it has been as the environment is now starting to change. IBM's view came in contrast to No. 1 software company Microsoft Corp., which said that it would not meet revenue estimates for the current quarter or fiscal year ending in June because of the ongoing technology slump.

Eventhough IBM's historicals for the last 3 quarters have been "pretty ugly"; the company's move to broaden its products will help it going forward. IBM used to be a diversified hardware company. Now they are a truly diversified IT (information technology) company with services and software.

IBM said that, excluding a charge, its fourth-quarter profit would have been $2.3 billion, or $1.34 per share, compared with $2.6 billion, or $1.46 per share, a year earlier, beating analysts' average forecasts of $1.30 per share on that basis.

Analysts said future growth for IBM depends largely on services, which accounted for about 45 percent of revenue. IBM said it drummed up $18 billion in new service contracts.

IBM Dividend reinvestment Program
To participate in the IBM Dividend Reinvestment Program
option, you must be stockholder of record. This means
you must have at least one share registered in your name
on the records of IBM.  Stock held in "street"or "nominee
name" with a broker, bank or other financial institution
is NOT eligible to participate in the IBM Dividend 
Reinvestment option. If you are not a registered owner 
and wish to enroll in the IBM Dividend Reinvestment Plan, 
please contact your broker for your initial purchase, have 
them issue a stock certificate registered in your name and 
contact Equiserve for an enrollment form.

EquiServe, First Chicago Trust Division Mail Suite 4688 P.O. Box 2530 Jersey City, NJ 07303-2530 (201) 324-0218 (888) IBM-6700 An alternative way would be to buy shares directly through the IBM Investor Services Program. This program allows a convenient method of purchasing additional shares with a minimal investment fee. To request the IBM Dividend Reinvestment package contact above address For additional shareholder information contact IBM Stockholder relations ( located at the address below ) IBM Stockholder Relations IBM Corporation New Orchard Road Armonk, NY 10504 (914) 499-7777 DRIP Information: Shares to Qualify = 1 Auto-reinvestment = yes Min/Max = $50 to $250,000/per year Reinvestment Fees - Dividend investment fees: 2% to $3 Cash investment fees: $5 Auto reinvestment fees: $1


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