INTL BUSINESS MACHINES CORP (IBM.DE) Fundamental Analysis & Valuation

FRA:IBM • US4592001014

Current stock price

197.6 EUR
-0.58 (-0.29%)
Last:

This IBM.DE fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

7

1. IBM.DE Profitability Analysis

1.1 Basic Checks

  • In the past year IBM was profitable.
  • IBM had a positive operating cash flow in the past year.
  • Each year in the past 5 years IBM has been profitable.
  • In the past 5 years IBM always reported a positive cash flow from operatings.
IBM.DE Yearly Net Income VS EBIT VS OCF VS FCFIBM.DE Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B

1.2 Ratios

  • Looking at the Return On Assets, with a value of 6.88%, IBM is in the better half of the industry, outperforming 78.57% of the companies in the same industry.
  • The Return On Equity of IBM (32.61%) is better than 91.43% of its industry peers.
  • Looking at the Return On Invested Capital, with a value of 6.76%, IBM is in line with its industry, outperforming 44.29% of the companies in the same industry.
  • Measured over the past 3 years, the Average Return On Invested Capital for IBM is significantly below the industry average of 11.52%.
  • The last Return On Invested Capital (6.76%) for IBM is above the 3 year average (6.40%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 6.88%
ROE 32.61%
ROIC 6.76%
ROA(3y)5.64%
ROA(5y)4.51%
ROE(3y)29.27%
ROE(5y)25.13%
ROIC(3y)6.4%
ROIC(5y)5.77%
IBM.DE Yearly ROA, ROE, ROICIBM.DE Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60

1.3 Margins

  • IBM's Profit Margin of 15.60% is amongst the best of the industry. IBM outperforms 94.29% of its industry peers.
  • IBM's Profit Margin has improved in the last couple of years.
  • IBM's Operating Margin of 16.19% is amongst the best of the industry. IBM outperforms 91.43% of its industry peers.
  • IBM's Operating Margin has improved in the last couple of years.
  • IBM has a Gross Margin of 58.36%. This is comparable to the rest of the industry: IBM outperforms 42.86% of its industry peers.
  • In the last couple of years the Gross Margin of IBM has remained more or less at the same level.
Industry RankSector Rank
OM 16.19%
PM (TTM) 15.6%
GM 58.36%
OM growth 3Y12.07%
OM growth 5Y9.83%
PM growth 3Y79.59%
PM growth 5Y9.14%
GM growth 3Y2.52%
GM growth 5Y0.79%
IBM.DE Yearly Profit, Operating, Gross MarginsIBM.DE Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30 40 50

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2

2. IBM.DE Health Analysis

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so IBM is destroying value.
  • Compared to 1 year ago, IBM has more shares outstanding
  • The number of shares outstanding for IBM has been increased compared to 5 years ago.
  • Compared to 1 year ago, IBM has a worse debt to assets ratio.
IBM.DE Yearly Shares OutstandingIBM.DE Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 200M 400M 600M 800M
IBM.DE Yearly Total Debt VS Total AssetsIBM.DE Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50B 100B 150B

2.2 Solvency

  • IBM has an Altman-Z score of 3.06. This indicates that IBM is financially healthy and has little risk of bankruptcy at the moment.
  • With a decent Altman-Z score value of 3.06, IBM is doing good in the industry, outperforming 72.86% of the companies in the same industry.
  • The Debt to FCF ratio of IBM is 5.41, which is a neutral value as it means it would take IBM, 5.41 years of fcf income to pay off all of its debts.
  • With a Debt to FCF ratio value of 5.41, IBM perfoms like the industry average, outperforming 42.86% of the companies in the same industry.
  • IBM has a Debt/Equity ratio of 1.75. This is a high value indicating a heavy dependency on external financing.
  • With a Debt to Equity ratio value of 1.75, IBM is not doing good in the industry: 82.86% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 1.75
Debt/FCF 5.41
Altman-Z 3.06
ROIC/WACC0.7
WACC9.68%
IBM.DE Yearly LT Debt VS Equity VS FCFIBM.DE Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B 40B 50B

2.3 Liquidity

  • IBM has a Current Ratio of 0.80. This is a bad value and indicates that IBM is not financially healthy enough and could expect problems in meeting its short term obligations.
  • IBM has a Current ratio of 0.80. This is amonst the worse of the industry: IBM underperforms 81.43% of its industry peers.
  • A Quick Ratio of 0.76 indicates that IBM may have some problems paying its short term obligations.
  • The Quick ratio of IBM (0.76) is worse than 81.43% of its industry peers.
Industry RankSector Rank
Current Ratio 0.8
Quick Ratio 0.76
IBM.DE Yearly Current Assets VS Current LiabilitesIBM.DE Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B 40B

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5

3. IBM.DE Growth Analysis

3.1 Past

  • The Earnings Per Share has grown by an nice 15.90% over the past year.
  • Measured over the past 5 years, IBM shows a small growth in Earnings Per Share. The EPS has been growing by 5.94% on average per year.
  • IBM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.67%.
  • The Revenue has been growing slightly by 4.12% on average over the past years.
EPS 1Y (TTM)15.9%
EPS 3Y8.25%
EPS 5Y5.94%
EPS Q2Q%19.37%
Revenue 1Y (TTM)9.67%
Revenue growth 3Y3.72%
Revenue growth 5Y4.12%
Sales Q2Q%9.46%

3.2 Future

  • The Earnings Per Share is expected to grow by 6.29% on average over the next years.
  • The Revenue is expected to grow by 5.36% on average over the next years.
EPS Next Y8.16%
EPS Next 2Y8.19%
EPS Next 3Y8.77%
EPS Next 5Y6.29%
Revenue Next Year6.12%
Revenue Next 2Y5.36%
Revenue Next 3Y5.51%
Revenue Next 5Y5.36%

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 stable.
  • 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.
IBM.DE Yearly Revenue VS EstimatesIBM.DE Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 20B 40B 60B 80B 100B
IBM.DE Yearly EPS VS EstimatesIBM.DE Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 5 10 15 20 25

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3

4. IBM.DE Valuation Analysis

4.1 Price/Earnings Ratio

  • IBM is valuated rather expensively with a Price/Earnings ratio of 19.43.
  • IBM's Price/Earnings is on the same level as the industry average.
  • IBM's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.91.
  • Based on the Price/Forward Earnings ratio of 17.04, the valuation of IBM can be described as rather expensive.
  • The rest of the industry has a similar Price/Forward Earnings ratio as IBM.
  • When comparing the Price/Forward Earnings ratio of IBM to the average of the S&P500 Index (21.99), we can say IBM is valued slightly cheaper.
Industry RankSector Rank
PE 19.43
Fwd PE 17.04
IBM.DE Price Earnings VS Forward Price EarningsIBM.DE Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of IBM indicates a slightly more expensive valuation: IBM is more expensive than 72.86% of the companies listed in the same industry.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of IBM is on the same level as its industry peers.
Industry RankSector Rank
P/FCF 17.66
EV/EBITDA 16.63
IBM.DE Per share dataIBM.DE EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 20 -20 40 -40 60

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
  • IBM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.38
PEG (5Y)3.27
EPS Next 2Y8.19%
EPS Next 3Y8.77%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

6

5. IBM.DE Dividend Analysis

5.1 Amount

  • IBM has a Yearly Dividend Yield of 2.93%.
  • The stock price of IBM dropped by -22.74% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
  • Compared to an average industry Dividend Yield of 2.71, IBM has a dividend in line with its industry peers.
  • IBM's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
Industry RankSector Rank
Dividend Yield 2.93%

5.2 History

  • The dividend of IBM has a limited annual growth rate of 0.61%.
Dividend Growth(5Y)0.61%
Div Incr Years7
Div Non Decr Years7
IBM.DE Yearly Dividends per shareIBM.DE Yearly Dividends per shareYearly Dividends per share 2018 2019 2020 2021 2022 2023 2024 2025 2026 2 4 6

5.3 Sustainability

  • IBM pays out 58.42% of its income as dividend. This is a bit on the high side, but may be sustainable.
  • IBM's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP58.42%
EPS Next 2Y8.19%
EPS Next 3Y8.77%
IBM.DE Yearly Income VS Free CF VS DividendIBM.DE Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B
IBM.DE Dividend Payout.IBM.DE Dividend Payout, showing the Payout Ratio.IBM.DE Dividend Payout.PayoutRetained Earnings

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IBM.DE Fundamentals: All Metrics, Ratios and Statistics

INTL BUSINESS MACHINES CORP

FRA:IBM (4/29/2026, 2:16:47 PM)

197.6

-0.58 (-0.29%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Industry Strength4.35
Industry Growth22.36
Earnings (Last)04-22
Earnings (Next)07-22
Inst Owners65.22%
Inst Owner ChangeN/A
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap185.35B
Revenue(TTM)68.91B
Net Income(TTM)10.75B
Analysts74.07
Price Target261.37 (32.27%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 2.93%
Yearly Dividend5.73
Dividend Growth(5Y)0.61%
DP58.42%
Div Incr Years7
Div Non Decr Years7
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.24%
Min EPS beat(2)3.6%
Max EPS beat(2)4.88%
EPS beat(4)4
Avg EPS beat(4)5.16%
Min EPS beat(4)3.6%
Max EPS beat(4)7.28%
EPS beat(8)8
Avg EPS beat(8)6.13%
EPS beat(12)12
Avg EPS beat(12)5.37%
EPS beat(16)15
Avg EPS beat(16)4.51%
Revenue beat(2)2
Avg Revenue beat(2)1.17%
Min Revenue beat(2)0.96%
Max Revenue beat(2)1.37%
Revenue beat(4)4
Avg Revenue beat(4)1.04%
Min Revenue beat(4)0.5%
Max Revenue beat(4)1.37%
Revenue beat(8)5
Avg Revenue beat(8)0.2%
Revenue beat(12)5
Avg Revenue beat(12)-0.25%
Revenue beat(16)8
Avg Revenue beat(16)0.06%
PT rev (1m)-12.95%
PT rev (3m)4.41%
EPS NQ rev (1m)-0.46%
EPS NQ rev (3m)-0.05%
EPS NY rev (1m)0%
EPS NY rev (3m)1.58%
Revenue NQ rev (1m)0.13%
Revenue NQ rev (3m)0.06%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)1.43%
Valuation
Industry RankSector Rank
PE 19.43
Fwd PE 17.04
P/S 3.14
P/FCF 17.66
P/OCF 15.47
P/B 6.57
P/tB N/A
EV/EBITDA 16.63
EPS(TTM)10.17
EY5.15%
EPS(NY)11.6
Fwd EY5.87%
FCF(TTM)11.19
FCFY5.66%
OCF(TTM)12.77
OCFY6.46%
SpS62.9
BVpS30.1
TBVpS-51.44
PEG (NY)2.38
PEG (5Y)3.27
Graham Number82.9878 (-58%)
Profitability
Industry RankSector Rank
ROA 6.88%
ROE 32.61%
ROCE 9.61%
ROIC 6.76%
ROICexc 7.53%
ROICexgc 52.33%
OM 16.19%
PM (TTM) 15.6%
GM 58.36%
FCFM 17.79%
ROA(3y)5.64%
ROA(5y)4.51%
ROE(3y)29.27%
ROE(5y)25.13%
ROIC(3y)6.4%
ROIC(5y)5.77%
ROICexc(3y)7.39%
ROICexc(5y)6.53%
ROICexgc(3y)37.61%
ROICexgc(5y)31.37%
ROCE(3y)9.1%
ROCE(5y)8.19%
ROICexgc growth 3Y16.58%
ROICexgc growth 5Y28.25%
ROICexc growth 3Y11.41%
ROICexc growth 5Y15.19%
OM growth 3Y12.07%
OM growth 5Y9.83%
PM growth 3Y79.59%
PM growth 5Y9.14%
GM growth 3Y2.52%
GM growth 5Y0.79%
F-Score8
Asset Turnover0.44
Health
Industry RankSector Rank
Debt/Equity 1.75
Debt/FCF 5.41
Debt/EBITDA 3.55
Cap/Depr 33.88%
Cap/Sales 2.52%
Interest Coverage 250
Cash Conversion 85.97%
Profit Quality 114.01%
Current Ratio 0.8
Quick Ratio 0.76
Altman-Z 3.06
F-Score8
WACC9.68%
ROIC/WACC0.7
Cap/Depr(3y)37.3%
Cap/Depr(5y)39.22%
Cap/Sales(3y)2.73%
Cap/Sales(5y)3.25%
Profit Quality(3y)154.99%
Profit Quality(5y)231.2%
High Growth Momentum
Growth
EPS 1Y (TTM)15.9%
EPS 3Y8.25%
EPS 5Y5.94%
EPS Q2Q%19.37%
EPS Next Y8.16%
EPS Next 2Y8.19%
EPS Next 3Y8.77%
EPS Next 5Y6.29%
Revenue 1Y (TTM)9.67%
Revenue growth 3Y3.72%
Revenue growth 5Y4.12%
Sales Q2Q%9.46%
Revenue Next Year6.12%
Revenue Next 2Y5.36%
Revenue Next 3Y5.51%
Revenue Next 5Y5.36%
EBIT growth 1Y20.13%
EBIT growth 3Y16.24%
EBIT growth 5Y14.36%
EBIT Next Year50.48%
EBIT Next 3Y18.78%
EBIT Next 5Y16.19%
FCF growth 1Y-2.78%
FCF growth 3Y10.61%
FCF growth 5Y-5.21%
OCF growth 1Y-2.31%
OCF growth 3Y8.13%
OCF growth 5Y-6.23%

INTL BUSINESS MACHINES CORP / IBM.DE Fundamental Analysis FAQ

What is the fundamental rating for IBM stock?

ChartMill assigns a fundamental rating of 5 / 10 to IBM.DE.


What is the valuation status of INTL BUSINESS MACHINES CORP (IBM.DE) stock?

ChartMill assigns a valuation rating of 3 / 10 to INTL BUSINESS MACHINES CORP (IBM.DE). This can be considered as Overvalued.


Can you provide the profitability details for INTL BUSINESS MACHINES CORP?

INTL BUSINESS MACHINES CORP (IBM.DE) has a profitability rating of 7 / 10.


Can you provide the expected EPS growth for IBM stock?

The Earnings per Share (EPS) of INTL BUSINESS MACHINES CORP (IBM.DE) is expected to grow by 8.16% in the next year.


How sustainable is the dividend of INTL BUSINESS MACHINES CORP (IBM.DE) stock?

The dividend rating of INTL BUSINESS MACHINES CORP (IBM.DE) is 6 / 10 and the dividend payout ratio is 58.42%.