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International Business Machines Corporation (NYSE:IBM) is among the stocks Jim Cramer reviewed while discussing the Iran ceasefire that triggered a relief rally. Cramer called the company a bit of “mystery,” as he said:

IBM’s a bit of mystery, too. The last quarter, okay, so it was tad suspect, but I think the buy on this mild pullback is the right thing to do.

Stock market data. Photo by Jakub Zerdzicki on Pexels

International Business Machines Corporation (NYSE:IBM) provides software, consulting, and cloud and on-site technology solutions, along with financing to help clients use its products. Cramer commented on the company during the February 24 episode and commented:

Yesterday, Anthropic put out something that sounded like it could hurt IBM, and IBM stock lost over 13% like this. It was one of the worst declines in ages. IBM has the same problem as the hard-hit enterprise software cohort. It’s difficult to understand because some of its businesses are complicated. It was an astonishing decline for a company that is actually doing quite well.

Unfortunately, all the sellers needed to know is that there’s a successful software company, or in the case of IBM, a hardware company that sells software, Anthropic will mimic it for less money… just using its AI. Customers will pause their purchases to see what Anthropic can do, or maybe just ask vendors for shorter contracts for less money. Either way, it’s bad news. Could it free some IBM business? I guess people think that. Suddenly, once unassailable companies with great moats seem like they might not, might be worth nothing, yes, nothing.

While we acknowledge the potential of IBM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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