New York, Feb 24, 2026, 10:45 EST — Regular session
- IBM stock bounced nearly 5% at the open, clawing back some ground after plunging 13.2% just a day before.
- Investors are weighing if fresh AI coding tools might put pressure on legacy modernization work.
- IBM heads into a key stretch with its March 3 conference slot up next, followed by the earnings window on April 22.
IBM shares recovered 4.8% to hit $234.08 during Tuesday’s morning session, clawing back some ground after a sharp drop of over 10% the previous day. Analysts see little chance of customers fleeing IBM’s mainframe systems anytime soon. Evercore ISI’s Amit Daryanani stuck with his Outperform rating and $345 price target, noting that reliability and regulatory requirements keep mainframes essential for banks and government clients. Source
This kind of whipsaw is striking a nerve in U.S. tech, touching on a core question: can generative AI really cut the time and cost of major software rewrites, or is that just hype? IBM’s stock has ended up at the center of those anxieties, particularly when it comes to “modernization” projects—the bread and butter for sprawling services and software spending.
IBM plunged 13.2% Monday, notching its steepest single-day slide since Oct. 18, 2000. The move came after AI upstart Anthropic touted its Claude Code tool as a solution for updating COBOL, the decades-old language still powering IBM’s mainframe computers. Source
COBOL’s been around forever—unflashy, unyielding. The language underpins essential systems at banks, insurers, and government agencies. Untangling it isn’t easy; decades of business rules often exist solely within those lines of code, making the process slow.
Anthropic, in its blog post, noted that tools like Claude Code automate “exploration and analysis”—tasks that once kept big teams busy for months. The company also said AI could let teams update COBOL “in quarters instead of years.” Source
Jefferies’ Brent Thill echoed that view late Monday in a client note, writing that IBM is “already disrupting itself” with tools that refactor COBOL into modern languages. For Thill, the more pressing question is IBM’s broader hybrid cloud and software performance—mainframe stories aren’t the main event. He left his Buy rating and $370 target unchanged. Source
Ripples from the selloff hit software and security stocks, too, with questions swirling about how rapid advances in AI coding tools could impact testing, remediation, and consulting-heavy businesses. IBM, CrowdStrike, and Datadog showed up on traders’ lists Monday as the trend widened. Source
IBM’s tie-up with Anthropic isn’t new—the pair unveiled a partnership last year, plugging Claude into IBM’s enterprise dev tools. That bit of context did nothing to soften the first round of reactions. Source
On Monday, a separate SEC Form 4 revealed that IBM senior vice president Robert David Thomas disclosed restricted stock units vesting along with share disposals tied to those awards, some at $256.42 apiece. Form 4s track insider trades and equity changes. Source
But Tuesday’s uptick doesn’t put the bearish arguments to rest. Should automation actually reduce staffing and time for mapping legacy systems, IBM might run into difficulties where it’s long relied on clients paying for intensive, tailored work. Investors could keep selling into strength until there’s clearer evidence that demand remains solid.
Eyes are turning to IBM’s slot at the Morgan Stanley Technology, Media and Telecom Conference on March 3, with another marker set for its preliminary earnings on April 22. Investors want answers on where IBM stands—defense or monetization—when it comes to AI-powered code modernization. Source
