International Business Machines (IBM) put up one of its best quarters in years, with earnings per share of $1.50, excluding a special gain of five cents. That represented 15% year-over-year growth, which is amazing for a company this size. It was helped quite a bit by the company's aggressive new share buyback program, but that's OK -- we expected and hoped for that. We like it when the company is in there buying alongside us.

The company said that it saw improved U.S. demand in the second quarter and that it experienced remarkable growth in software, servers and services. IBM expressed unusual optimism about the rest of the year, considering that it usually downplays future results.

I still think it's attractive, because if the company can earn $10.50 per share in 2010, which is under its own $11 target, it could trade as high as $160 by the end of 2009 on a 15X multiple. I know that's a couple of "ifs" in a row, but that would be 20% price appreciation per year for the next two years, which would great for a low-risk machine like IBM.