IBM (IBM) is likely to raise its full-year constant-currency revenue growth forecast to "at least 6%" from above 5% when it reports Q2 results, supported by software strength, Oppenheimer said in a Tuesday note.

The brokerage said its channel checks showed "no major deviations" in contract trends, with "no customer attrition" and a continued 20%-30% uplift in enterprise license agreement pricing on renewals.

Oppenheimer said it expects IBM to report second-quarter revenue in line with consensus estimates and maintain its free cash flow guidance of about $15.7 billion, while strength in other infrastructure and the earlier-than-expected close of the Confluent acquisition support a higher full-year revenue outlook.

It said the durability and stickiness of IBM's software portfolio, particularly following the HashiCorp and Confluent acquisitions, support further valuation multiple expansion.

Oppenheimer reiterated its outperform rating and raised its price target to $350 from $320.

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