That said, the raises have become small. April’s increase was a single penny. The streak looks secure, but shareholders should not count on the payout itself growing rapidly.

I think the stock ends up higher

If IBM adds about $1 billion of free cash flow a year (the increase management still expects for 2026), that works out to roughly 6% annual growth. A stock that simply tracks that cash flow higher from about $230 today would trade near $310 in five years, with the dividend adding almost another 3% annually.

That’s a respectable result, in the neighborhood of what the broad market has historically returned. And it does not require software to reaccelerate — just for IBM to keep producing the cash it already forecasts.

Quantum is the most difficult driver to put a number on. IBM’s roadmap targets Starling, a large-scale fault-tolerant quantum computer, for 2029, inside this five-year window. And the investment is increasing: On Wednesday, Anderon, an IBM company, finalized a $1 billion CHIPS Act award, matched by another $1 billion from IBM itself, to accelerate research at its quantum wafer foundry in Albany, New York. Quantum could arguably become a material business by 2031. Of course, I would not pay for that today.

The swing factor, again, is software. If the segment returns to the double-digit growth it recorded in the first quarter, the market could pay more than the stock’s current valuation of about 18 times 2027’s expected earnings. At the June record, the price worked out to about 25 times the same earnings estimates.

If instead the second quarter’s pace is the new normal, the stock may not go anywhere over five years. After all, July showed what the market believes 1% growth is worth.

Ultimately, my best guess is a stock somewhere in the low $300s five years from now, with cash flow and the dividend doing most of the work. That path would take shares most of the way back to their June record.

Is that path worth buying into today? I don’t think so, at least not yet. The one thing that would make the stock compelling — software growth turning back up — has not happened. I would hold off until it does.

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I Think IBM Stock Will Be Higher in 5 Years. I Still Wouldn’t Buy It Today. was originally published by The Motley Fool

Spot Bitcoin ETFs began trading on January 11, 2024, and reached their cumulative total of $55.161 billion in just over 32 months, averaging around $1.71 billion per month. At this pace, the fund would reach an additional $60.5 billion in about 35 months, likely placing the 10% milestone around mid-2029.

However, this estimate assumes a consistent pace of inflows, and historical data shows that Bitcoin ETF inflows have fluctuated. A strong quarter could advance this timeline by months, while significant redemptions could push it back just as far.

One Bitcoin in Ten Would Leave the Tradable Float

As the percentage of Bitcoin held by ETFs increases, it affects market dynamics. Coins held by custodians on behalf of funds do not enter the order book of exchanges unless redeemed by authorized participants. Currently, at 6.29%, one Bitcoin in sixteen has been removed from circulation. At 10%, this would become one in ten.

This reduction in floating supply means fewer coins are available to meet demand, resulting in more volatile price movements. A market with limited floating supply tends to rise sharply on demand but also decline steeply when demand fades, as fewer coins are available to buffer selling pressure. Thin markets are not calm markets.

Corporate treasuries and long-term holders are also removing Bitcoin from the market, but the ETF share is one of the few measurable metrics monitored weekly.

What Happens If the Flows Reverse Instead

The week ending September 18 highlighted how quickly inflow directions can shift. On September 14, inflows totaled $160.04 million.

Just one day later, after the Senate rejected the CLARITY Act, the funds experienced an outflow of $450.33 million. The following day, after the Federal Reserve raised its target range by 25 basis points to 3.75% to 4.00%, another $295.98 million flowed out. Ultimately, the week closed with a net outflow of just $6.21 million.

Four funds lost money across those five sessions. The ARK 21Shares Bitcoin ETF (CBOE:ARKB) saw the largest weekly outflow at $141.9 million, followed by Grayscale Bitcoin Trust (NYSE:GBTC) with a loss of $62.3 million, VanEck Bitcoin ETF (CBOE:HODL) shedding $5.3 million, and Bitwise Bitcoin ETF (NYSE:BITB) losing $2.7 million, per Farside.

So the 6.29% is not a ratchet. Any coins held by these funds can return to the market if shareholders decide to exit, and two sessions in September alone pulled $746.31 million back out. The key figure to monitor is the weekly cumulative inflows against the $60.5 billion gap, which shows how rapidly the funds are approaching the 10% threshold and how quickly they could retreat from it.

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Single Biggest Decision: Who Reports the Interest

The executor of the father’s estate has a one-time election under IRS rules: report all accrued interest through the date of death on the father’s final Form 1040, or pass the deferral through to the beneficiary.

If the father died with little other income, his final return may have empty space in the 10%, 12%, and 22% brackets. Stuffing $80,000 of bond interest into that return could tax it at a blended rate well below what the daughter, still working at 63, would pay. If she is in the 24% or 32% federal bracket, letting the interest flow to her can cost tens of thousands more than reporting it on the decedent’s return.

The catch: the election generally has to be made on a timely filed final return for the decedent. Once that window closes, the daughter is stuck with the deferred interest on her own 1040 in whatever year she redeems.

Two Realistic Paths Forward

Assuming the executor election is still available, the cleaner path for most families looks like this:

1. Report the accrued interest on the father’s final return. Pay the tax out of estate assets before distribution. The daughter then inherits bonds with a “basis” equal to their value at date of death, and any interest earned after that point is the only thing she owes tax on going forward. This usually wins when the decedent’s marginal rate is lower than the heir’s.

2. Take the deferral and stagger redemptions. If some bonds have not yet reached final maturity, she can cash a portion each year to keep herself out of the 32% or 35% bracket. This only helps for bonds still earning; anything past 30 years is taxable in the maturity year regardless of when she walks into the bank.

Holding the bonds indefinitely is usually the weakest option. The current I-bond composite rate of 4.26% and the 10-year Treasury yield near 5% mean matured paper bonds sitting in a drawer are earning zero while a Treasury or CD would pay competitive interest, and the tax bill is due either way.

What to Do This Week

Pull every bond and look up the issue date and final maturity date on TreasuryDirect’s savings bond calculator. Any bond dated before 1996 is almost certainly past final maturity, meaning the interest is already taxable and further delay only wastes purchasing power.

Then talk to the estate’s accountant before the father’s final return is filed. The election to accelerate interest onto the decedent’s 1040 is worth real money in most cases. If federal estate tax was paid on the bonds, the daughter also gets an itemized IRD deduction on her own return for her share of that tax, which is commonly missed. It is the kind of quiet rule that costs families five and six figures, and we mapped several more like it in a free guide to the tax traps that ambush retirees and their heirs.

The mistake to avoid: cashing all $118,000 in one calendar year without a plan. Doing so on top of a working salary can push an otherwise middle-bracket taxpayer into the 32% federal bracket, add a Medicare surtax, and trigger IRMAA premium increases two years later when she files for Medicare at 65.

Before Your Next Withdrawal, Run One Number ( It’s Not The 4% Rule Everyone Knows)

Take your essential monthly expenses and subtract your guaranteed income — Social Security, plus any pension. What’s left is your income gap, and how you close it determines whether retirement runs on share sales or on a paycheck your portfolio writes you every month. Our free reader guide, The 4% Rule Is Broken, shows exactly how to close that gap with portfolio income: a worked example (one retiree needed about $480,000 in income-producing assets to cover his essentials for good), an eight-point conversion checklist, and the 20-year numbers comparing dividends to withdrawals. It’s free and takes about 15 minutes to read. Get the guide here before you take your next withdrawal.

Contact editorial@247wallst.com for any questions or corrections.