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

FRA:IBM • US4592001014

Current stock price

207.05 EUR
-1.8 (-0.86%)
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.
  • In the past 5 years IBM has always 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

  • The Return On Assets of IBM (6.97%) is better than 75.34% of its industry peers.
  • With an excellent Return On Equity value of 32.45%, IBM belongs to the best of the industry, outperforming 90.41% of the companies in the same industry.
  • With a Return On Invested Capital value of 6.85%, IBM perfoms like the industry average, outperforming 43.84% 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 12.04%.
  • The last Return On Invested Capital (6.85%) for IBM is above the 3 year average (6.31%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 6.97%
ROE 32.45%
ROIC 6.85%
ROA(3y)5.64%
ROA(5y)4.51%
ROE(3y)29.27%
ROE(5y)25.13%
ROIC(3y)6.31%
ROIC(5y)5.71%
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

  • The Profit Margin of IBM (15.69%) is better than 93.15% of its industry peers.
  • In the last couple of years the Profit Margin of IBM has grown nicely.
  • IBM has a better Operating Margin (16.30%) than 91.78% of its industry peers.
  • IBM's Operating Margin has improved in the last couple of years.
  • IBM has a Gross Margin of 58.19%. This is comparable to the rest of the industry: IBM outperforms 46.58% of its industry peers.
  • IBM's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 16.3%
PM (TTM) 15.69%
GM 58.19%
OM growth 3Y10.55%
OM growth 5Y8.93%
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

  • IBM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it 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.
  • The debt/assets ratio for IBM is higher compared to a year ago.
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

  • An Altman-Z score of 3.24 indicates that IBM is not in any danger for bankruptcy at the moment.
  • IBM's Altman-Z score of 3.24 is fine compared to the rest of the industry. IBM outperforms 72.60% of its industry peers.
  • IBM has a debt to FCF ratio of 5.29. This is a neutral value as IBM would need 5.29 years to pay back of all of its debts.
  • With a Debt to FCF ratio value of 5.29, IBM perfoms like the industry average, outperforming 41.10% of the companies in the same industry.
  • IBM has a Debt/Equity ratio of 1.68. This is a high value indicating a heavy dependency on external financing.
  • IBM's Debt to Equity ratio of 1.68 is on the low side compared to the rest of the industry. IBM is outperformed by 80.82% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.68
Debt/FCF 5.29
Altman-Z 3.24
ROIC/WACC0.79
WACC8.7%
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

  • A Current Ratio of 0.96 indicates that IBM may have some problems paying its short term obligations.
  • The Current ratio of IBM (0.96) is worse than 72.60% of its industry peers.
  • A Quick Ratio of 0.92 indicates that IBM may have some problems paying its short term obligations.
  • Looking at the Quick ratio, with a value of 0.92, IBM is doing worse than 71.23% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 0.96
Quick Ratio 0.92
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 12.00% over the past year.
  • IBM shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.94% yearly.
  • Looking at the last year, IBM shows a small growth in Revenue. The Revenue has grown by 7.62% in the last year.
  • The Revenue has been growing slightly by 4.12% on average over the past years.
EPS 1Y (TTM)12%
EPS 3Y8.25%
EPS 5Y5.94%
EPS Q2Q%15.31%
Revenue 1Y (TTM)7.62%
Revenue growth 3Y3.72%
Revenue growth 5Y4.12%
Sales Q2Q%12.15%

3.2 Future

  • The Earnings Per Share is expected to grow by 11.08% on average over the next years. This is quite good.
  • Based on estimates for the next years, IBM will show a small growth in Revenue. The Revenue will grow by 5.87% on average per year.
EPS Next Y8.16%
EPS Next 2Y8.29%
EPS Next 3Y8.96%
EPS Next 5Y11.08%
Revenue Next Year6.17%
Revenue Next 2Y5.38%
Revenue Next 3Y5.35%
Revenue Next 5Y5.87%

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.
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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2

4. IBM.DE Valuation Analysis

4.1 Price/Earnings Ratio

  • A Price/Earnings ratio of 20.56 indicates a rather expensive valuation of IBM.
  • IBM's Price/Earnings is on the same level as the industry average.
  • IBM's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.35.
  • The Price/Forward Earnings ratio is 19.00, which indicates a rather expensive current valuation of IBM.
  • IBM's Price/Forward Earnings ratio is in line with the industry average.
  • IBM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.61.
Industry RankSector Rank
PE 20.56
Fwd PE 19
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

  • IBM's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. IBM is more expensive than 71.23% of the companies in the same industry.
  • IBM's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 19.27
EV/EBITDA 16.91
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 IBM does not grow enough to justify the current Price/Earnings ratio.
  • The decent profitability rating of IBM may justify a higher PE ratio.
PEG (NY)2.52
PEG (5Y)3.46
EPS Next 2Y8.29%
EPS Next 3Y8.96%

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

5

5. IBM.DE Dividend Analysis

5.1 Amount

  • IBM has a Yearly Dividend Yield of 2.78%. Purely for dividend investing, there may be better candidates out there.
  • IBM's Dividend Yield is comparable with the industry average which is at 2.90.
  • IBM's Dividend Yield is a higher than the S&P500 average which is at 1.89.
Industry RankSector Rank
Dividend Yield 2.78%

5.2 History

  • The dividend of IBM has a limited annual growth rate of 0.63%.
Dividend Growth(5Y)0.63%
Div Incr Years6
Div Non Decr Years6
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

  • 59.05% of the earnings are spent on dividend by IBM. 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.
DP59.05%
EPS Next 2Y8.29%
EPS Next 3Y8.96%
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 (3/31/2026, 5:06:07 PM)

207.05

-1.8 (-0.86%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)01-28
Earnings (Next)04-22
Inst Owners65.54%
Inst Owner ChangeN/A
Ins Owners0.1%
Ins Owner ChangeN/A
Market Cap194.22B
Revenue(TTM)67.53B
Net Income(TTM)10.59B
Analysts74.07
Price Target300.26 (45.02%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 2.78%
Yearly Dividend5.84
Dividend Growth(5Y)0.63%
DP59.05%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.44%
Min EPS beat(2)3.6%
Max EPS beat(2)7.28%
EPS beat(4)4
Avg EPS beat(4)7.19%
Min EPS beat(4)3.6%
Max EPS beat(4)12.97%
EPS beat(8)8
Avg EPS beat(8)6.03%
EPS beat(12)12
Avg EPS beat(12)5.55%
EPS beat(16)15
Avg EPS beat(16)4.22%
Revenue beat(2)2
Avg Revenue beat(2)0.94%
Min Revenue beat(2)0.5%
Max Revenue beat(2)1.37%
Revenue beat(4)4
Avg Revenue beat(4)0.81%
Min Revenue beat(4)0.01%
Max Revenue beat(4)1.37%
Revenue beat(8)4
Avg Revenue beat(8)-0.12%
Revenue beat(12)4
Avg Revenue beat(12)-0.46%
Revenue beat(16)8
Avg Revenue beat(16)0.09%
PT rev (1m)10.84%
PT rev (3m)19.31%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.75%
EPS NY rev (1m)-0.37%
EPS NY rev (3m)1.61%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.35%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)1.49%
Valuation
Industry RankSector Rank
PE 20.56
Fwd PE 19
P/S 3.3
P/FCF 19.27
P/OCF 16.91
P/B 6.83
P/tB N/A
EV/EBITDA 16.91
EPS(TTM)10.07
EY4.86%
EPS(NY)10.9
Fwd EY5.26%
FCF(TTM)10.75
FCFY5.19%
OCF(TTM)12.25
OCFY5.92%
SpS62.69
BVpS30.31
TBVpS-43.13
PEG (NY)2.52
PEG (5Y)3.46
Graham Number82.87
Profitability
Industry RankSector Rank
ROA 6.97%
ROE 32.45%
ROCE 9.72%
ROIC 6.85%
ROICexc 7.84%
ROICexgc 39.35%
OM 16.3%
PM (TTM) 15.69%
GM 58.19%
FCFM 17.14%
ROA(3y)5.64%
ROA(5y)4.51%
ROE(3y)29.27%
ROE(5y)25.13%
ROIC(3y)6.31%
ROIC(5y)5.71%
ROICexc(3y)7.28%
ROICexc(5y)6.47%
ROICexgc(3y)37.08%
ROICexgc(5y)31.05%
ROCE(3y)8.97%
ROCE(5y)8.11%
ROICexgc growth 3Y15%
ROICexgc growth 5Y27.2%
ROICexc growth 3Y9.9%
ROICexc growth 5Y14.25%
OM growth 3Y10.55%
OM growth 5Y8.93%
PM growth 3Y79.59%
PM growth 5Y9.14%
GM growth 3Y2.52%
GM growth 5Y0.79%
F-Score6
Asset Turnover0.44
Health
Industry RankSector Rank
Debt/Equity 1.68
Debt/FCF 5.29
Debt/EBITDA 3.42
Cap/Depr 32.2%
Cap/Sales 2.39%
Interest Coverage 250
Cash Conversion 82.3%
Profit Quality 109.28%
Current Ratio 0.96
Quick Ratio 0.92
Altman-Z 3.24
F-Score6
WACC8.7%
ROIC/WACC0.79
Cap/Depr(3y)36.49%
Cap/Depr(5y)38.74%
Cap/Sales(3y)2.67%
Cap/Sales(5y)3.22%
Profit Quality(3y)155.37%
Profit Quality(5y)231.43%
High Growth Momentum
Growth
EPS 1Y (TTM)12%
EPS 3Y8.25%
EPS 5Y5.94%
EPS Q2Q%15.31%
EPS Next Y8.16%
EPS Next 2Y8.29%
EPS Next 3Y8.96%
EPS Next 5Y11.08%
Revenue 1Y (TTM)7.62%
Revenue growth 3Y3.72%
Revenue growth 5Y4.12%
Sales Q2Q%12.15%
Revenue Next Year6.17%
Revenue Next 2Y5.38%
Revenue Next 3Y5.35%
Revenue Next 5Y5.87%
EBIT growth 1Y20.21%
EBIT growth 3Y14.66%
EBIT growth 5Y13.42%
EBIT Next Year50.69%
EBIT Next 3Y18.76%
EBIT Next 5Y16.19%
FCF growth 1Y-1.57%
FCF growth 3Y11%
FCF growth 5Y-5.01%
OCF growth 1Y-1.88%
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 4 / 10 to IBM.DE.


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

ChartMill assigns a valuation rating of 2 / 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 5 / 10 and the dividend payout ratio is 59.05%.