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IBM's own retirement fund sells most of its Big Blue shares


May, 16 2017, 6:49 AM

Warren Buffett isn't the only investor shying away from shares in Big Blue.

The billionaire investor recently disclosed he had sold much of his holdings in the tech giant. "I don't value IBM the same way ..." he said of that sell-off decision. The news sent IBM shares down more than 2 percent.

Now news emerges that IBM's own retirement fund has sold most of its shares in Big Blue.

"In what could come as a huge embarrassment for IBM, it’s very own pension fund has also sold most of its shares in the company," reports Computer Business Review.

"IBM’s Retirement fund reportedly cut its holdings in IBM stock from 82,802 shares as of December 31, 2016 to just 12,451 shares as of March 31 of 2017."

But there's more than reservation about IBM in the sale, CBR notes, since the fund also cut back on shares on other tech firms such as Microsoft and Apple.

"Although the dumping of stock by its very own pension fund is embarrassing and will do nothing for investor confidence, it could merely point to a shift in strategy for the retirement fund," CBR says.

"However, for IBM, it will be hard to shake-off the embarrassment of both its biggest shareholder and own pension fund dumping stock."

The Register in the U.K., which reports aggressively about IBM, concurs that the move doesn't look good for Big Blue.

the fund's divestment is still a bad look for two reasons.

"Firstly, IBM's pension fund deciding that holding IBM stock isn't the best way to meet its obligations is hardly a vote of confidence in the company's future. Or a vote of confidence in the tech sector in general," The Register says.

"Second, the pension fund is not the only company worried about Big Blue's prospects. Also in Q1, widely-admired investor Warren Buffet recently shed most of his IBM stock after reportedly souring on Big Blue's prospects. Buffet is thought to worry that for all of IBM's impressive dividend-paying powers, its long string of quarterly revenue reductions doesn't exactly suggest its planned cloud-and-AI-fuelled rebound is imminent."

IBM operates one of its largest corporate campuses in RTP and employs several thousand people across North Carolina.

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