INTL BUSINESS MACHINES CORP (1IBM.MI) Stock Fundamental Analysis
Europe - BIT:1IBM - US4592001014 - Common Stock
268.4 EUR
+0.95 (+0.36%)
Taking everything into account, 1IBM scores 4 out of 10 in our fundamental rating. 1IBM was compared to 70 industry peers in the IT Services industry. While 1IBM has a great profitability rating, there are quite some concerns on its financial health. 1IBM is quite expensive at the moment. It does show a decent growth rate.
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
1IBM has a Return On Assets of 5.40%. This is in the better half of the industry: 1IBM outperforms 62.86% of its industry peers.
1IBM has a Return On Equity of 28.34%. This is amongst the best in the industry. 1IBM outperforms 90.00% of its industry peers.
1IBM has a Return On Invested Capital of 8.07%. This is comparable to the rest of the industry: 1IBM outperforms 47.14% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1IBM 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 91.43% of its industry peers.
1IBM's Profit Margin has declined in the last couple of years.
1IBM's Operating Margin of 16.06% is amongst the best of the industry. 1IBM outperforms 90.00% of its industry peers.
In the last couple of years the Operating Margin of 1IBM has remained more or less at the same level.
Looking at the Gross Margin, with a value of 57.81%, 1IBM is in line with its industry, outperforming 41.43% of the companies in the same industry.
1IBM's Gross Margin has been stable in the last couple of years.
| 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.
1IBM has more shares outstanding than it did 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 3.57. This indicates that 1IBM is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of 1IBM (3.57) is better than 75.71% 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.
Looking at the Debt to FCF ratio, with a value of 5.27, 1IBM is in line with its industry, outperforming 45.71% of the companies in the same industry.
1IBM has a Debt/Equity ratio of 1.98. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of 1IBM (1.98) is worse than 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.98 | ||
| Debt/FCF | 5.27 | ||
| Altman-Z | 3.57 |
ROIC/WACC0.95
WACC8.47%
2.3 Liquidity
A Current Ratio of 0.93 indicates that 1IBM may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.93, 1IBM is doing worse than 71.43% of the companies in the same industry.
1IBM has a Quick 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.
1IBM has a Quick ratio of 0.89. This is in the lower half of the industry: 1IBM underperforms 72.86% 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%.
Measured over the past years, 1IBM shows a decrease in Earnings Per Share. The EPS has been decreasing by -4.21% on average per year.
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
1IBM is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.21% yearly.
1IBM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.94% yearly.
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
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
With a Price/Earnings ratio of 28.10, 1IBM can be considered very expensive at the moment.
1IBM's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.13. 1IBM is around the same levels.
With a Price/Forward Earnings ratio of 25.65, 1IBM can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, 1IBM is valued a bit more expensive than the industry average as 64.29% of the companies are valued more cheaply.
1IBM is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.35, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.1 | ||
| Fwd PE | 25.65 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1IBM is valued a bit more expensive than the industry average as 75.71% of the companies are valued more cheaply.
60.00% of the companies in the same industry are cheaper than 1IBM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24 | ||
| EV/EBITDA | 21.66 |
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.
The decent profitability rating of 1IBM may justify a higher PE ratio.
PEG (NY)3.19
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.
1IBM's Dividend Yield is a higher than the industry average which is at 3.86.
Compared to an average S&P500 Dividend Yield of 2.39, 1IBM has a dividend comparable with the average S&P500 company.
| 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.
The dividend of 1IBM is growing, but earnings are growing more, so the dividend growth is 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 | 28.1 | ||
| Fwd PE | 25.65 | ||
| P/S | 4.39 | ||
| P/FCF | 24 | ||
| P/OCF | 21.31 | ||
| P/B | 10.3 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.66 |
EPS(TTM)9.55
EY3.56%
EPS(NY)10.47
Fwd EY3.9%
FCF(TTM)11.18
FCFY4.17%
OCF(TTM)12.6
OCFY4.69%
SpS61.1
BVpS26.07
TBVpS-47.85
PEG (NY)3.19
PEG (5Y)N/A
Graham Number74.84
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 | 3.57 |
F-Score6
WACC8.47%
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 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 28.1 and the Price/Book (PB) ratio is 10.3.
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%.