INTL BUSINESS MACHINES CORP (1IBM.MI) Stock Fundamental Analysis
Europe - BIT:1IBM - US4592001014 - Common Stock
268.4 EUR
+0.95 (+0.36%)
1IBM gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 70 industry peers in the IT Services industry. While 1IBM has a great profitability rating, there are quite some concerns on its financial health. While showing a medium growth rate, 1IBM is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year 1IBM was profitable.
1IBM had a positive operating cash flow in the past year.
1IBM had positive earnings in each of the past 5 years.
1IBM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 5.40%, 1IBM is in the better half of the industry, outperforming 64.29% of the companies in the same industry.
Looking at the Return On Equity, with a value of 28.34%, 1IBM belongs to the top of the industry, outperforming 91.43% of the companies in the same industry.
With a Return On Invested Capital value of 8.07%, 1IBM perfoms like the industry average, outperforming 48.57% of the companies in the same industry.
1IBM had an Average Return On Invested Capital over the past 3 years of 7.07%. This is significantly below the industry average of 21.24%.
The 3 year average ROIC (7.07%) for 1IBM is below the current ROIC(8.07%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.4% | ||
| ROE | 28.34% | ||
| ROIC | 8.07% |
ROA(3y)3.74%
ROA(5y)3.83%
ROE(3y)20.94%
ROE(5y)24.07%
ROIC(3y)7.07%
ROIC(5y)6.14%
1.3 Margins
1IBM has a Profit Margin of 12.09%. This is amongst the best in the industry. 1IBM outperforms 92.86% of its industry peers.
In the last couple of years the Profit Margin of 1IBM has declined.
With an excellent Operating Margin value of 16.06%, 1IBM belongs to the best of the industry, outperforming 91.43% of the companies in the same industry.
1IBM's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 57.81%, 1IBM perfoms like the industry average, outperforming 42.86% of the companies in the same industry.
In the last couple of years the Gross Margin of 1IBM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.06% | ||
| PM (TTM) | 12.09% | ||
| GM | 57.81% |
OM growth 3Y10.6%
OM growth 5Y0.28%
PM growth 3Y-1.4%
PM growth 5Y-10.1%
GM growth 3Y1.05%
GM growth 5Y0.73%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 1IBM is destroying value.
The number of shares outstanding for 1IBM has been increased compared to 1 year ago.
1IBM has more shares outstanding than it did 5 years ago.
The debt/assets ratio for 1IBM has been reduced compared to a year ago.
2.2 Solvency
1IBM has an Altman-Z score of 3.58. This indicates that 1IBM is financially healthy and has little risk of bankruptcy at the moment.
1IBM has a better Altman-Z score (3.58) than 77.14% of its industry peers.
1IBM has a debt to FCF ratio of 5.27. This is a neutral value as 1IBM would need 5.27 years to pay back of all of its debts.
1IBM has a Debt to FCF ratio of 5.27. This is comparable to the rest of the industry: 1IBM outperforms 47.14% of its industry peers.
A Debt/Equity ratio of 1.98 is on the high side and indicates that 1IBM has dependencies on debt financing.
1IBM's Debt to Equity ratio of 1.98 is on the low side compared to the rest of the industry. 1IBM is outperformed by 78.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.98 | ||
| Debt/FCF | 5.27 | ||
| Altman-Z | 3.58 |
ROIC/WACC0.95
WACC8.46%
2.3 Liquidity
A Current Ratio of 0.93 indicates that 1IBM may have some problems paying its short term obligations.
1IBM has a worse Current ratio (0.93) than 70.00% of its industry peers.
A Quick Ratio of 0.89 indicates that 1IBM may have some problems paying its short term obligations.
1IBM has a Quick ratio of 0.89. This is in the lower half of the industry: 1IBM underperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
1IBM shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.71%.
The Earnings Per Share has been decreasing by -4.21% on average over the past years.
The Revenue has been growing slightly by 4.51% in the past year.
1IBM shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.69% yearly.
EPS 1Y (TTM)6.71%
EPS 3Y1.19%
EPS 5Y-4.21%
EPS Q2Q%15.22%
Revenue 1Y (TTM)4.51%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%9.11%
3.2 Future
1IBM is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.21% yearly.
The Revenue is expected to grow by 4.94% on average over the next years.
EPS Next Y8.82%
EPS Next 2Y7.9%
EPS Next 3Y7.12%
EPS Next 5Y6.21%
Revenue Next Year6.33%
Revenue Next 2Y5.38%
Revenue Next 3Y5.05%
Revenue Next 5Y4.94%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 28.22 indicates a quite expensive valuation of 1IBM.
1IBM's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 25.83. 1IBM is around the same levels.
With a Price/Forward Earnings ratio of 25.74, 1IBM can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 1IBM indicates a slightly more expensive valuation: 1IBM is more expensive than 62.86% of the companies listed in the same industry.
1IBM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 32.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.22 | ||
| Fwd PE | 25.74 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1IBM indicates a slightly more expensive valuation: 1IBM is more expensive than 75.71% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1IBM indicates a slightly more expensive valuation: 1IBM is more expensive than 60.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.09 | ||
| EV/EBITDA | 21.72 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1IBM does not grow enough to justify the current Price/Earnings ratio.
1IBM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.2
PEG (5Y)N/A
EPS Next 2Y7.9%
EPS Next 3Y7.12%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.36%, 1IBM has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.86, 1IBM pays a bit more dividend than its industry peers.
1IBM's Dividend Yield is comparable with the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.36% |
5.2 History
The dividend of 1IBM has a limited annual growth rate of 0.81%.
Dividend Growth(5Y)0.81%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
1IBM pays out 78.75% of its income as dividend. This is not a sustainable payout ratio.
1IBM's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP78.75%
EPS Next 2Y7.9%
EPS Next 3Y7.12%
BIT:1IBM (10/30/2025, 7:00:00 PM)
268.4
+0.95 (+0.36%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners65.04%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap250.02B
Revenue(TTM)65.40B
Net Income(TTM)7.91B
Analysts69.63
Price Target240.73 (-10.31%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.36% |
Yearly Dividend5.75
Dividend Growth(5Y)0.81%
DP78.75%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.08%
Min EPS beat(2)4.89%
Max EPS beat(2)7.28%
EPS beat(4)4
Avg EPS beat(4)7.18%
Min EPS beat(4)3.59%
Max EPS beat(4)12.97%
EPS beat(8)8
Avg EPS beat(8)5.75%
EPS beat(12)11
Avg EPS beat(12)5.17%
EPS beat(16)15
Avg EPS beat(16)4.03%
Revenue beat(2)2
Avg Revenue beat(2)0.92%
Min Revenue beat(2)0.5%
Max Revenue beat(2)1.34%
Revenue beat(4)3
Avg Revenue beat(4)0.23%
Min Revenue beat(4)-0.93%
Max Revenue beat(4)1.34%
Revenue beat(8)3
Avg Revenue beat(8)-0.35%
Revenue beat(12)4
Avg Revenue beat(12)-0.51%
Revenue beat(16)8
Avg Revenue beat(16)0.23%
PT rev (1m)0.82%
PT rev (3m)5.9%
EPS NQ rev (1m)-0.07%
EPS NQ rev (3m)1.64%
EPS NY rev (1m)0.15%
EPS NY rev (3m)1.86%
Revenue NQ rev (1m)-0.22%
Revenue NQ rev (3m)1.1%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)0.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.22 | ||
| Fwd PE | 25.74 | ||
| P/S | 4.41 | ||
| P/FCF | 24.09 | ||
| P/OCF | 21.39 | ||
| P/B | 10.33 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.72 |
EPS(TTM)9.51
EY3.54%
EPS(NY)10.43
Fwd EY3.89%
FCF(TTM)11.14
FCFY4.15%
OCF(TTM)12.55
OCFY4.68%
SpS60.88
BVpS25.97
TBVpS-47.68
PEG (NY)3.2
PEG (5Y)N/A
Graham Number74.55
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.4% | ||
| ROE | 28.34% | ||
| ROCE | 9.45% | ||
| ROIC | 8.07% | ||
| ROICexc | 9.31% | ||
| ROICexgc | 52.18% | ||
| OM | 16.06% | ||
| PM (TTM) | 12.09% | ||
| GM | 57.81% | ||
| FCFM | 18.31% |
ROA(3y)3.74%
ROA(5y)3.83%
ROE(3y)20.94%
ROE(5y)24.07%
ROIC(3y)7.07%
ROIC(5y)6.14%
ROICexc(3y)8.07%
ROICexc(5y)6.94%
ROICexgc(3y)39.64%
ROICexgc(5y)31.12%
ROCE(3y)8.28%
ROCE(5y)7.2%
ROICexgc growth 3Y23.43%
ROICexgc growth 5Y15.29%
ROICexc growth 3Y14.68%
ROICexc growth 5Y5.67%
OM growth 3Y10.6%
OM growth 5Y0.28%
PM growth 3Y-1.4%
PM growth 5Y-10.1%
GM growth 3Y1.05%
GM growth 5Y0.73%
F-Score6
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.98 | ||
| Debt/FCF | 5.27 | ||
| Debt/EBITDA | 3.6 | ||
| Cap/Depr | 31.23% | ||
| Cap/Sales | 2.31% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 87.87% | ||
| Profit Quality | 151.41% | ||
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.89 | ||
| Altman-Z | 3.58 |
F-Score6
WACC8.46%
ROIC/WACC0.95
Cap/Depr(3y)39.45%
Cap/Depr(5y)41.95%
Cap/Sales(3y)2.96%
Cap/Sales(5y)3.91%
Profit Quality(3y)291.08%
Profit Quality(5y)263.12%
High Growth Momentum
Growth
EPS 1Y (TTM)6.71%
EPS 3Y1.19%
EPS 5Y-4.21%
EPS Q2Q%15.22%
EPS Next Y8.82%
EPS Next 2Y7.9%
EPS Next 3Y7.12%
EPS Next 5Y6.21%
Revenue 1Y (TTM)4.51%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%9.11%
Revenue Next Year6.33%
Revenue Next 2Y5.38%
Revenue Next 3Y5.05%
Revenue Next 5Y4.94%
EBIT growth 1Y14.74%
EBIT growth 3Y13.97%
EBIT growth 5Y1.98%
EBIT Next Year72.33%
EBIT Next 3Y25.44%
EBIT Next 5Y19.31%
FCF growth 1Y3.97%
FCF growth 3Y5.46%
FCF growth 5Y-0.17%
OCF growth 1Y0.37%
OCF growth 3Y1.67%
OCF growth 5Y-1.86%
INTL BUSINESS MACHINES CORP / 1IBM.MI FAQ
What is the ChartMill fundamental rating of INTL BUSINESS MACHINES CORP (1IBM.MI) stock?
ChartMill assigns a fundamental rating of 4 / 10 to 1IBM.MI.
Can you provide the valuation status for INTL BUSINESS MACHINES CORP?
ChartMill assigns a valuation rating of 2 / 10 to INTL BUSINESS MACHINES CORP (1IBM.MI). This can be considered as Overvalued.
How profitable is INTL BUSINESS MACHINES CORP (1IBM.MI) stock?
INTL BUSINESS MACHINES CORP (1IBM.MI) has a profitability rating of 7 / 10.
What are the PE and PB ratios of INTL BUSINESS MACHINES CORP (1IBM.MI) stock?
The Price/Earnings (PE) ratio for INTL BUSINESS MACHINES CORP (1IBM.MI) is 28.22 and the Price/Book (PB) ratio is 10.33.
How sustainable is the dividend of INTL BUSINESS MACHINES CORP (1IBM.MI) stock?
The dividend rating of INTL BUSINESS MACHINES CORP (1IBM.MI) is 4 / 10 and the dividend payout ratio is 78.75%.