IBM's stock has risen 45% this year, as investors have warmed to the company's growing reputation as a recession-buster. One of the big success stories of the economic slowdown, IBM continued its margin growth in the third quarter, despite year-over-year revenue declines in most of its business units. Software led the way during the third quarter with a gross profit margin of 85.7% and the company pushed its overall margin up by almost two percentage points to 45.1%.

"Software was the key profit driver for IBM during its expansion over the past six years, and continues to drive profit growth even during the recession," wrote Allan Krans, a senior analyst at TBR, in a note released Friday. "Although IBM was outpaced in growth by more aggressive competitors such as Microsoft ( MSFT) and VMware ( VMW) during positive economic conditions, IBM Software is maintaining much more consistent performance during the recession."

Microsoft, in contrast, has been hit with falling sales, and VMware has seen a significant slowdown in its recent explosive growth.

Hot on the heels of Intel's ( INTC) third-quarter results, IBM's numbers have also been cited as further evidence of a tech recovery.

"Overall, sequential improvement in hardware and services and flattish software sales provide another indication that demand is beginning to improve," wrote Goldman Sachs' Bailey. " But for Hardware, IBM's limited revenue and earnings upside reinforces our shift from companies with earnings resiliency to those with more robust top-line growth and operating leverage."

Revenue from IBM's Systems and Technology group fell 12% year over year, but was flat compared to the prior quarter. IBM CFO Mark Loughridge nonetheless struck a bullish tone during a conference call to discuss the results Thursday.

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