In a note released Friday, Wells Fargo analyst Maynard Um described his expectations for International Business Machines Corp. (NYSE: IBM) third-quarter results.

Looking to revenue, Um believes there is slight downside to the consensus of $23.4 billion and is predicting $23.2 billion. However, he sees the company's EPS coming in inline with the consensus of $4.33.

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In a glance ahead, Um says a potential server divestiture gain should allow IBM to beat its fiscal 2014 EPS guidance of at least $18. Additionally, he expects the company to reaffirm its fiscal 2015 EPS guidance of at least $20.

As for what Um is looking for in terms of IBM's business, he commented, "We will be looking for evidence in a bottoming of the company's legacy businesses (amidst the backdrop of what appears to be an increasingly tougher macro backdrop) and growth/traction of its new businesses."

Um has maintained his Market Perform rating and valuation range of $185-$195.

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