A Wall Street analyst says Red Hat's CEO is seen by investors as the likely successor to IBM chief Ginni Rometty

IBMIBM CEO Ginni Rometty (right) with Red Hat CEO Jim Whitehurst (left)A Wall Street analyst said many investors see Red Hat CEO Jim Whitehurst as a potential successor to IBM chief Ginni Rometty.Morgan Stanley analyst Katy Huberty noted the speculation on Whitehurst as IBM unveiled its big plans for Red Hat which it sees key to its bid to conquer the hybrid cloud market.Click here for more BI Prime stories.A Wall Street analyst says some investors now see Red Hat CEO Jim Whitehurst as a likely successor to IBM chief Ginni Rometty, in what could be the most meaningful result of IBM's blockbuster $34 billion acquisition.IBM closed its acquisition of Red Hat three weeks ago, and on Thursday unveiled its ambitious plan for the open source cloud software company. The acquisition was a controversial move that some observers said would lead to another failed megamerger. A big worry is that Red Hat would lose its edge under IBM given the two companies diverse cultures.Morgan Stanley analyst Katy Huberty noted that one of the risks in big mergers is that the acquired company loses key executives, sales or R&D teams, diluting the value of intangibles spanning culture, brand and customer relationships.But that may not be a worry with the IBM-Red Hat merger.In the case of Red Hat, Jim Whitehurst will remain with IBM and is viewed by many investors as a potential CEO successor, Huberty wrote in a research note.Whitehurst's possible ascent to the IBM's top post has come up in media reports in the past. The latest speculation on Whitehurst's IBM future comes at a time IBM is unveiling its ambitious plans for Red Hat, which it says will be key in its bid to dominate the hybrid cloud market. IBM is meeting with investors on Friday to talk about our go-to-market strategy with Red Hat, a spokesperson told Business Insider.Red Hat's products are popular among developers and could potentially expand the tech giant's reach in enterprise cloud.IBM certainly needs such a boost. The company has seen its revenue decline in 26 of the last 29 quarters.Known as a corporate powerhouse that dominated the enterprise tech market for decades, IBM found itself outmaneuvered in the rapid growth of the cloud, which allowed businesses to set up and maintain computing networks on web-based platforms. That market is dominated by the likes of Amazon, Microsoft and Google. But IBM has been pushing for a bigger cloud presence by zeroing in on the hybrid cloud market, where businesses store and process data and use applications on a public cloud, while keeping a significant portion of the workload in their own data centers.Huberty of Morgan Stanley resumed coverage of IBM on Thursday with an overweight rating, which is equivalent to a buy, based on recent trends in IBM's business and the potential gain from Red Hat.IBM is in the latter innings of a transformation meant to return the company to growth and margin expansion, both of which kicked in over the past year and should accelerate post the closing of the Red Hat acquisition.Got a tip about IBM or another tech company? Contact this reporter via email at bpimentel@businessinsider.com, message him on Twitter @benpimentel. You can also contact Business Insider securely via SecureDrop.Get the latest IBM stock price here. NOW WATCH: The Navy has its own Area 51 and it's right in the middle of the Bahamas function receiveMessage(event){ console.log(event.data.fullscreen); Android.fullscreen(event.data.fullscreen); }window.addEventListener(message, receiveMessage, false);

A Wall Street analyst says Red Hat's CEO is seen by investors as the likely successor to IBM chief Ginni Rometty

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A Wall Street analyst says Red Hat's CEO is seen by investors as the likely successor to IBM chief Ginni Rometty

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