INTL BUSINESS MACHINES CORP (1IBM.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1IBM - US4592001014 - Common Stock
258.75 EUR
-0.35 (-0.14%)
1IBM gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 76 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 valied quite expensively at the moment, while 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 63.16% of its industry peers.
- 1IBM has a better Return On Equity (28.34%) than 89.47% 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 48.68% 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 25.98%.
- 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
- The Profit Margin of 1IBM (12.09%) is better than 92.11% of its industry peers.
- In the last couple of years the Profit Margin of 1IBM has declined.
- 1IBM has a better Operating Margin (16.06%) than 92.11% 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 44.74% 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
- 1IBM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it 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
- An Altman-Z score of 3.54 indicates that 1IBM is not in any danger for bankruptcy at the moment.
- 1IBM has a Altman-Z score of 3.54. This is in the better half of the industry: 1IBM outperforms 69.74% of its industry peers.
- 1IBM has a debt to FCF ratio of 5.27. This is a neutral value as 1IBM would need 5.27 years to pay back of all of its debts.
- 1IBM's Debt to FCF ratio of 5.27 is in line compared to the rest of the industry. 1IBM outperforms 47.37% of its industry peers.
- 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 78.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.98 | ||
| Debt/FCF | 5.27 | ||
| Altman-Z | 3.54 |
ROIC/WACC0.93
WACC8.69%
2.3 Liquidity
- A Current Ratio of 0.93 indicates that 1IBM may have some problems paying its short term obligations.
- 1IBM's Current ratio of 0.93 is on the low side compared to the rest of the industry. 1IBM is outperformed by 73.68% of its industry peers.
- A Quick Ratio of 0.89 indicates that 1IBM may have some problems paying its short term obligations.
- With a Quick ratio value of 0.89, 1IBM is not doing good in the industry: 73.68% of the companies in the same industry are doing better.
| 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%.
- 1IBM shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -4.21% yearly.
- Looking at the last year, 1IBM shows a small growth in Revenue. The Revenue has grown by 4.51% in the last year.
- The Revenue has been growing slightly by 1.69% on average over the past years.
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 6.07% yearly.
- 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%
EPS Next 2Y9.2%
EPS Next 3Y8.19%
EPS Next 5Y6.07%
Revenue Next Year6.82%
Revenue Next 2Y5.75%
Revenue Next 3Y5.24%
Revenue Next 5Y5.12%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- 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 27.41, the valuation of 1IBM can be described as expensive.
- 1IBM's Price/Earnings is on the same level as the industry average.
- Compared to an average S&P500 Price/Earnings ratio of 26.94, 1IBM is valued at the same level.
- Based on the Price/Forward Earnings ratio of 24.40, the valuation of 1IBM can be described as rather expensive.
- 1IBM's Price/Forward Earnings ratio is in line with the industry average.
- 1IBM is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.94, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.41 | ||
| Fwd PE | 24.4 |
4.2 Price Multiples
- 75.00% of the companies in the same industry are cheaper than 1IBM, based on the Enterprise Value to EBITDA ratio.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1IBM is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.47 | ||
| EV/EBITDA | 21.27 |
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)2.49
PEG (5Y)N/A
EPS Next 2Y9.2%
EPS Next 3Y8.19%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.26%, 1IBM has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.10, 1IBM pays a bit more dividend than its industry peers.
- 1IBM's Dividend Yield is a higher than the S&P500 average which is at 1.83.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.26% |
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
- 78.75% of the earnings are spent on dividend by 1IBM. 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 2Y9.2%
EPS Next 3Y8.19%
BIT:1IBM (1/19/2026, 7:00:00 PM)
258.75
-0.35 (-0.14%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)10-22 2025-10-22/amc
Earnings (Next)01-28 2026-01-28/amc
Inst Owners64.18%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap241.86B
Revenue(TTM)65.40B
Net Income(TTM)7.91B
Analysts71.85
Price Target250.47 (-3.2%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.26% |
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)-0.03%
PT rev (3m)4.04%
EPS NQ rev (1m)-0.34%
EPS NQ rev (3m)-0.75%
EPS NY rev (1m)-0.09%
EPS NY rev (3m)1.98%
Revenue NQ rev (1m)-0.02%
Revenue NQ rev (3m)0.01%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.41 | ||
| Fwd PE | 24.4 | ||
| P/S | 4.3 | ||
| P/FCF | 23.47 | ||
| P/OCF | 20.84 | ||
| P/B | 10.07 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.27 |
EPS(TTM)9.44
EY3.65%
EPS(NY)10.6
Fwd EY4.1%
FCF(TTM)11.03
FCFY4.26%
OCF(TTM)12.42
OCFY4.8%
SpS60.23
BVpS25.7
TBVpS-47.17
PEG (NY)2.49
PEG (5Y)N/A
Graham Number73.88
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 | 3.54 |
F-Score6
WACC8.69%
ROIC/WACC0.93
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%
EPS Next 2Y9.2%
EPS Next 3Y8.19%
EPS Next 5Y6.07%
Revenue 1Y (TTM)4.51%
Revenue growth 3Y3.05%
Revenue growth 5Y1.69%
Sales Q2Q%9.11%
Revenue Next Year6.82%
Revenue Next 2Y5.75%
Revenue Next 3Y5.24%
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.
What is the valuation status of INTL BUSINESS MACHINES CORP (1IBM.MI) stock?
ChartMill assigns a valuation rating of 2 / 10 to INTL BUSINESS MACHINES CORP (1IBM.MI). This can be considered as Overvalued.
What is the profitability of 1IBM stock?
INTL BUSINESS MACHINES CORP (1IBM.MI) has a profitability rating of 7 / 10.
Can you provide the expected EPS growth for 1IBM stock?
The Earnings per Share (EPS) of INTL BUSINESS MACHINES CORP (1IBM.MI) is expected to grow by 11% in the next year.
Is the dividend of INTL BUSINESS MACHINES CORP sustainable?
The dividend rating of INTL BUSINESS MACHINES CORP (1IBM.MI) is 4 / 10 and the dividend payout ratio is 78.75%.