by Anura Guruge
Click to ENLARGE. Created by Anura Guruge
Amazon (AMZN) stock performance vs. that of IBM over the last 5 years. What more do you need to know. Chart, of course, from marketwatch.com. Who else? Click to ENLARGE. Visit marketwatch.com to get your own.
This must have occurred to Jeff Bezos. I had already talked about this way back in October 2015.
Makes a lot of sense and there are some amazing synergies when it comes to artificial intelligence (AI) (and IBM’s Watson), Cloud plays & server technologies. Plus, Amazon can tap into IBM’s still lucrative revenue streams from software licensing, product leasing and maintenance contracts. Plus, IBM still must have some choice real estate in places that should suit Amazon.
Amazon’s Market Cap is 2.4 times that of IBM’s.
I would have to think that a majority of IBM shareholders would be happy to get 1 share of AMZN for every 4.5 shares of IBM. That would put the sell price at around $177. Yes, the lack of a dividend will gall some, BUT AMZN’s amazing growth should be a compensation.
Yes, I would benefit from this in multiple ways. Yes, I am a long-term AMZN shareholder and this deal will make AMZN even sweeter down the road. Plus it will bring the two halves of my adult life nicely together. IBM was my life for 36-years. I am only ‘here’ because of IBM. A few years after I stopped doing IBM stuff, I bought into AMZN. I am NOW on;y ‘here’ because of AMZN. So, this will be perfect from my perspective.
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by Anura Guruge