IBM's Second Chance

Leading into a crucial second-quarter earnings report after the bell Monday, shares of IBM(IBM Quote) have broken out of their depressed state in the past couple of weeks, as once again investors raise their hopes for better things to come.

The company isn't expected to repeat the dour performance of the prior quarter, when it soundly missed its financial targets, plunging its shares to a two-year low, but IBM's overall progress in strengthening its services operations and in cutting costs will be keys to extending the stock's current momentum.

Shares are up 10% in July to $81.77, after bouncing between a range of $73 to $77 from mid-May through June. For the year, however, shares remain sacked -- off 17% from its starting level just under $100. The prospect of a rebound above triple digits is enticing, though, considering that an extended stay above the century mark hasn't happened since early 2002. ...