INTL BUSINESS MACHINES CORP (1IBM.MI) Stock Fundamental Analysis
Europe - BIT:1IBM - US4592001014 - Common Stock
244.2 EUR
+2.95 (+1.22%)
Taking everything into account, 1IBM scores 4 out of 10 in our fundamental rating. 1IBM was compared to 73 industry peers in the IT Services industry. 1IBM scores excellent on profitability, but there are 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.
In the past year 1IBM had a positive cash flow from operations.
Each year in the past 5 years 1IBM has been profitable.
Each year in the past 5 years 1IBM had a positive operating cash flow.
1.2 Ratios
The Return On Assets of 1IBM (3.93%) is comparable to the rest of the industry.
1IBM has a better Return On Equity (21.20%) than 84.93% of its industry peers.
1IBM has a Return On Invested Capital of 7.55%. This is comparable to the rest of the industry: 1IBM outperforms 46.58% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for 1IBM is below the industry average of 11.06%.
The 3 year average ROIC (7.26%) for 1IBM is below the current ROIC(7.55%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.93% | ||
| ROE | 21.2% | ||
| ROIC | 7.55% |
ROA(3y)3.74%
ROA(5y)3.83%
ROE(3y)20.94%
ROE(5y)24.07%
ROIC(3y)7.26%
ROIC(5y)6.26%
1.3 Margins
1IBM's Profit Margin of 9.11% is amongst the best of the industry. 1IBM outperforms 86.30% of its industry peers.
1IBM's Profit Margin has declined in the last couple of years.
1IBM's Operating Margin of 15.32% is amongst the best of the industry. 1IBM outperforms 90.41% of its industry peers.
1IBM's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 57.57%, 1IBM is in line with its industry, outperforming 47.95% 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 | 15.32% | ||
| PM (TTM) | 9.11% | ||
| GM | 57.57% |
OM growth 3Y13.36%
OM growth 5Y1.77%
PM growth 3Y-1.4%
PM growth 5Y-10.1%
GM growth 3Y1.05%
GM growth 5Y0.73%
2. Health
2.1 Basic Checks
1IBM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for 1IBM has been increased compared to 1 year ago.
The number of shares outstanding for 1IBM has been increased compared to 5 years ago.
The debt/assets ratio for 1IBM has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.38 indicates that 1IBM is not in any danger for bankruptcy at the moment.
The Altman-Z score of 1IBM (3.38) is better than 73.97% of its industry peers.
1IBM has a debt to FCF ratio of 5.46. This is a neutral value as 1IBM would need 5.46 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.46, 1IBM is in line with its industry, outperforming 43.84% of the companies in the same industry.
A Debt/Equity ratio of 2.01 is on the high side and indicates that 1IBM has dependencies on debt financing.
1IBM has a Debt to Equity ratio of 2.01. This is amonst the worse of the industry: 1IBM underperforms 80.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | 5.46 | ||
| Altman-Z | 3.38 |
ROIC/WACC0.91
WACC8.33%
2.3 Liquidity
1IBM has a Current Ratio of 0.91. This is a bad value and indicates that 1IBM is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.91, 1IBM is doing worse than 78.08% of the companies in the same industry.
A Quick Ratio of 0.87 indicates that 1IBM may have some problems paying its short term obligations.
1IBM has a worse Quick ratio (0.87) than 76.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
1IBM shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.32%.
The Earnings Per Share has been decreasing by -4.21% on average over the past years.
Looking at the last year, 1IBM shows a small growth in Revenue. The Revenue has grown by 2.69% in the last year.
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)4.32%
EPS 3Y1.19%
EPS 5Y-4.21%
EPS Q2Q%15.23%
Revenue 1Y (TTM)2.69%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%7.65%
3.2 Future
The Earnings Per Share is expected to grow by 6.21% on average over the next years.
The Revenue is expected to grow by 4.94% on average over the next years.
EPS Next Y8.85%
EPS Next 2Y7.92%
EPS Next 3Y7.16%
EPS Next 5Y6.21%
Revenue Next Year6.38%
Revenue Next 2Y5.37%
Revenue Next 3Y5.04%
Revenue Next 5Y4.94%
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.
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
The Price/Earnings ratio is 26.69, which means the current valuation is very expensive for 1IBM.
1IBM's Price/Earnings is on the same level as the industry average.
1IBM is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.02, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 23.57, which indicates a rather expensive current valuation of 1IBM.
60.27% of the companies in the same industry are cheaper than 1IBM, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of 1IBM to the average of the S&P500 Index (22.57), we can say 1IBM is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.69 | ||
| Fwd PE | 23.57 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1IBM is valued a bit more expensive than the industry average as 72.60% of the companies are valued more cheaply.
The rest of the industry has a similar Price/Free Cash Flow ratio as 1IBM.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.46 | ||
| EV/EBITDA | 21.43 |
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)3.02
PEG (5Y)N/A
EPS Next 2Y7.92%
EPS Next 3Y7.16%
5. Dividend
5.1 Amount
1IBM has a Yearly Dividend Yield of 2.34%.
1IBM's Dividend Yield is a higher than the industry average which is at 7.36.
1IBM's Dividend Yield is comparable with the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.34% |
5.2 History
The dividend of 1IBM has a limited annual growth rate of 0.83%.
Dividend Growth(5Y)0.83%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
106.31% of the earnings are spent on dividend by 1IBM. This is not a sustainable payout ratio.
1IBM's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP106.31%
EPS Next 2Y7.92%
EPS Next 3Y7.16%
BIT:1IBM (10/10/2025, 7:00:00 PM)
244.2
+2.95 (+1.22%)
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 Cap227.48B
Analysts69.63
Price Target240.73 (-1.42%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.34% |
Yearly Dividend5.7
Dividend Growth(5Y)0.83%
DP106.31%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.93%
Min EPS beat(2)4.89%
Max EPS beat(2)12.97%
EPS beat(4)4
Avg EPS beat(4)5.93%
Min EPS beat(4)2.27%
Max EPS beat(4)12.97%
EPS beat(8)8
Avg EPS beat(8)5.15%
EPS beat(12)11
Avg EPS beat(12)4.65%
EPS beat(16)14
Avg EPS beat(16)3.57%
Revenue beat(2)2
Avg Revenue beat(2)0.68%
Min Revenue beat(2)0.01%
Max Revenue beat(2)1.34%
Revenue beat(4)2
Avg Revenue beat(4)-0.31%
Min Revenue beat(4)-1.66%
Max Revenue beat(4)1.34%
Revenue beat(8)2
Avg Revenue beat(8)-0.52%
Revenue beat(12)4
Avg Revenue beat(12)-0.27%
Revenue beat(16)7
Avg Revenue beat(16)-1.44%
PT rev (1m)0.96%
PT rev (3m)5.9%
EPS NQ rev (1m)0.1%
EPS NQ rev (3m)-1%
EPS NY rev (1m)0.17%
EPS NY rev (3m)1.89%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)0.27%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)0.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.69 | ||
| Fwd PE | 23.57 | ||
| P/S | 4.12 | ||
| P/FCF | 22.46 | ||
| P/OCF | 19.88 | ||
| P/B | 9.6 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.43 |
EPS(TTM)9.15
EY3.75%
EPS(NY)10.36
Fwd EY4.24%
FCF(TTM)10.87
FCFY4.45%
OCF(TTM)12.28
OCFY5.03%
SpS59.21
BVpS25.43
TBVpS-48.31
PEG (NY)3.02
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.93% | ||
| ROE | 21.2% | ||
| ROCE | 8.85% | ||
| ROIC | 7.55% | ||
| ROICexc | 8.78% | ||
| ROICexgc | 53.5% | ||
| OM | 15.32% | ||
| PM (TTM) | 9.11% | ||
| GM | 57.57% | ||
| FCFM | 18.36% |
ROA(3y)3.74%
ROA(5y)3.83%
ROE(3y)20.94%
ROE(5y)24.07%
ROIC(3y)7.26%
ROIC(5y)6.26%
ROICexc(3y)8.29%
ROICexc(5y)7.07%
ROICexgc(3y)40.75%
ROICexgc(5y)31.79%
ROCE(3y)8.5%
ROCE(5y)7.33%
ROICexcg growth 3Y26.58%
ROICexcg growth 5Y17.04%
ROICexc growth 3Y17.55%
ROICexc growth 5Y7.25%
OM growth 3Y13.36%
OM growth 5Y1.77%
PM growth 3Y-1.4%
PM growth 5Y-10.1%
GM growth 3Y1.05%
GM growth 5Y0.73%
F-Score5
Asset Turnover0.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.01 | ||
| Debt/FCF | 5.46 | ||
| Debt/EBITDA | 3.77 | ||
| Cap/Depr | 31.62% | ||
| Cap/Sales | 2.38% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 90.78% | ||
| Profit Quality | 201.58% | ||
| Current Ratio | 0.91 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 3.38 |
F-Score5
WACC8.33%
ROIC/WACC0.91
Cap/Depr(3y)35.46%
Cap/Depr(5y)39.55%
Cap/Sales(3y)2.66%
Cap/Sales(5y)3.73%
Profit Quality(3y)294.17%
Profit Quality(5y)264.98%
High Growth Momentum
Growth
EPS 1Y (TTM)4.32%
EPS 3Y1.19%
EPS 5Y-4.21%
EPS Q2Q%15.23%
EPS Next Y8.85%
EPS Next 2Y7.92%
EPS Next 3Y7.16%
EPS Next 5Y6.21%
Revenue 1Y (TTM)2.69%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%7.65%
Revenue Next Year6.38%
Revenue Next 2Y5.37%
Revenue Next 3Y5.04%
Revenue Next 5Y4.94%
EBIT growth 1Y8.54%
EBIT growth 3Y16.81%
EBIT growth 5Y3.49%
EBIT Next Year72.33%
EBIT Next 3Y25.44%
EBIT Next 5Y19.31%
FCF growth 1Y14.17%
FCF growth 3Y7.1%
FCF growth 5Y0.76%
OCF growth 1Y8.18%
OCF growth 3Y1.67%
OCF growth 5Y-1.86%