INTL BUSINESS MACHINES CORP (1IBM.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1IBM - US4592001014 - Common Stock
257.3 EUR
-11.05 (-4.12%)
Taking everything into account, 1IBM scores 4 out of 10 in our fundamental rating. 1IBM was compared to 76 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
1IBM had positive earnings in the past year.
In the past year 1IBM had a positive cash flow from operations.
Each year in the past 5 years 1IBM has been profitable.
In the past 5 years 1IBM always reported a positive cash flow from operatings.
1.2 Ratios
1IBM's Return On Assets of 5.40% is fine compared to the rest of the industry. 1IBM outperforms 64.00% of its industry peers.
1IBM has a Return On Equity of 28.34%. This is amongst the best in the industry. 1IBM outperforms 89.33% of its industry peers.
Looking at the Return On Invested Capital, with a value of 8.07%, 1IBM is in line with its industry, outperforming 45.33% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for 1IBM is significantly below the industry average of 26.78%.
The last Return On Invested Capital (8.07%) for 1IBM is above the 3 year average (7.07%), which is a sign of increasing profitability.
| 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 better Profit Margin (12.09%) than 92.00% of its industry peers.
1IBM's Profit Margin has declined in the last couple of years.
1IBM has a better Operating Margin (16.06%) than 92.00% of its industry peers.
1IBM's Operating Margin has been stable in the last couple of years.
1IBM has a Gross Margin (57.81%) which is comparable to the rest of the 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), 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.
Compared to 1 year ago, 1IBM has an improved debt to assets ratio.
2.2 Solvency
1IBM has an Altman-Z score of 3.55. This indicates that 1IBM is financially healthy and has little risk of bankruptcy at the moment.
1IBM has a better Altman-Z score (3.55) than 72.00% of its industry peers.
The Debt to FCF ratio of 1IBM is 5.27, which is a neutral value as it means it would take 1IBM, 5.27 years of fcf income to pay off all of its debts.
1IBM has a Debt to FCF ratio (5.27) which is in line with its industry peers.
1IBM has a Debt/Equity ratio of 1.98. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.98, 1IBM is not doing good in the industry: 80.00% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.98 | ||
| Debt/FCF | 5.27 | ||
| Altman-Z | 3.55 |
ROIC/WACC0.97
WACC8.36%
2.3 Liquidity
1IBM has a Current Ratio of 0.93. This is a bad value and indicates that 1IBM is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of 1IBM (0.93) is worse than 73.33% of its industry peers.
A Quick Ratio of 0.89 indicates that 1IBM may have some problems paying its short term obligations.
1IBM's Quick ratio of 0.89 is on the low side compared to the rest of the industry. 1IBM is outperformed by 74.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.93 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.71% over the past year.
The Earnings Per Share has been decreasing by -4.21% on average over the past years.
1IBM shows a small growth in Revenue. In the last year, the Revenue has grown by 4.51%.
Measured over the past years, 1IBM shows a small growth in Revenue. The Revenue has been growing by 1.69% on average per year.
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
Based on estimates for the next years, 1IBM will show a small growth in Earnings Per Share. The EPS will grow by 6.07% on average per year.
1IBM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.12% yearly.
EPS Next Y11.1%
EPS Next 2Y9.19%
EPS Next 3Y8.11%
EPS Next 5Y6.07%
Revenue Next Year6.83%
Revenue Next 2Y5.7%
Revenue Next 3Y5.23%
Revenue Next 5Y5.12%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 27.46, the valuation of 1IBM can be described as expensive.
1IBM's Price/Earnings is on the same level as the industry average.
1IBM's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.59.
The Price/Forward Earnings ratio is 24.47, which indicates a rather expensive current valuation of 1IBM.
1IBM's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. 1IBM is more expensive than 61.33% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.03, 1IBM is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.46 | ||
| Fwd PE | 24.47 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1IBM is valued a bit more expensive than 73.33% of the companies 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 62.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.53 | ||
| EV/EBITDA | 21.45 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
1IBM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.47
PEG (5Y)N/A
EPS Next 2Y9.19%
EPS Next 3Y8.11%
5. Dividend
5.1 Amount
1IBM has a Yearly Dividend Yield of 2.24%.
Compared to an average industry Dividend Yield of 2.27, 1IBM has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 1.87, 1IBM has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
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.
The dividend of 1IBM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP78.75%
EPS Next 2Y9.19%
EPS Next 3Y8.11%
BIT:1IBM (12/23/2025, 7:00:00 PM)
257.3
-11.05 (-4.12%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners64.13%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap240.51B
Revenue(TTM)65.40B
Net Income(TTM)7.91B
Analysts71.85
Price Target253.84 (-1.34%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.24% |
Yearly Dividend5.7
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)6.17%
PT rev (3m)6.31%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)-0.03%
EPS NY rev (3m)2.25%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.11%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.46 | ||
| Fwd PE | 24.47 | ||
| P/S | 4.31 | ||
| P/FCF | 23.53 | ||
| P/OCF | 20.89 | ||
| P/B | 10.09 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.45 |
EPS(TTM)9.37
EY3.64%
EPS(NY)10.52
Fwd EY4.09%
FCF(TTM)10.94
FCFY4.25%
OCF(TTM)12.32
OCFY4.79%
SpS59.74
BVpS25.49
TBVpS-46.79
PEG (NY)2.47
PEG (5Y)N/A
Graham Number73.31
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 | 3.55 |
F-Score6
WACC8.36%
ROIC/WACC0.97
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 Y11.1%
EPS Next 2Y9.19%
EPS Next 3Y8.11%
EPS Next 5Y6.07%
Revenue 1Y (TTM)4.51%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%9.11%
Revenue Next Year6.83%
Revenue Next 2Y5.7%
Revenue Next 3Y5.23%
Revenue Next 5Y5.12%
EBIT growth 1Y14.74%
EBIT growth 3Y13.97%
EBIT growth 5Y1.98%
EBIT Next Year73.84%
EBIT Next 3Y24.02%
EBIT Next 5Y17.21%
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 1 / 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 27.46 and the Price/Book (PB) ratio is 10.09.
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%.