INTL BUSINESS MACHINES CORP (IBM.DE) Stock Fundamental Analysis

FRA:IBM • US4592001014

218.15 EUR
-0.3 (-0.14%)
Last: Feb 18, 2026, 03:07 PM
Overview Stock Chart Technical Analysis Fundamental Analysis Analyst Ratings Earnings Estimates Financials Ownership
Fundamental Rating

4

We assign a fundamental rating of 4 out of 10 to IBM. IBM was compared to 71 industry peers in the IT Services industry. While IBM has a great profitability rating, there are quite some concerns on its financial health. IBM is quite expensive at the moment. It does show a decent growth rate.


Dividend Valuation Growth Profitability Health

7

1. Profitability

1.1 Basic Checks

  • In the past year IBM was profitable.
  • In the past year IBM had a positive cash flow from operations.
  • 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

  • IBM has a Return On Assets of 6.97%. This is in the better half of the industry: IBM outperforms 70.42% of its industry peers.
  • Looking at the Return On Equity, with a value of 32.45%, IBM belongs to the top of the industry, outperforming 90.14% of the companies in the same industry.
  • With a Return On Invested Capital value of 6.85%, IBM perfoms like the industry average, outperforming 42.25% of the companies in the same industry.
  • IBM had an Average Return On Invested Capital over the past 3 years of 6.31%. This is below the industry average of 11.09%.
  • 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

  • IBM's Profit Margin of 15.69% is amongst the best of the industry. IBM outperforms 92.96% of its industry peers.
  • IBM's Profit Margin has improved in the last couple of years.
  • IBM has a better Operating Margin (16.30%) than 92.96% of its industry peers.
  • IBM's Operating Margin has improved in the last couple of years.
  • IBM has a Gross Margin (58.19%) which is comparable to the rest of the industry.
  • In the last couple of years the Gross Margin of IBM has remained more or less at the same level.
Industry RankSector Rank
OM 16.3%
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. Health

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
  • Compared to 5 years ago, IBM has more shares outstanding
  • 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 3.32 indicates that IBM is not in any danger for bankruptcy at the moment.
  • With a decent Altman-Z score value of 3.32, IBM is doing good in the industry, outperforming 69.01% of the companies in the same industry.
  • The Debt to FCF ratio of IBM is 5.29, which is a neutral value as it means it would take IBM, 5.29 years of fcf income to pay off all of its debts.
  • IBM has a Debt to FCF ratio (5.29) which is comparable to the rest of the 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 80.28% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.68
Debt/FCF 5.29
Altman-Z 3.32
ROIC/WACC0.76
WACC8.98%
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.
  • IBM has a worse Current ratio (0.96) than 73.24% 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 70.42% 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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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. Growth

3.1 Past

  • IBM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.00%, which is quite good.
  • The Earnings Per Share has been growing slightly by 5.94% on average over the past years.
  • IBM shows a small growth in Revenue. In the last year, the Revenue has grown by 7.62%.
  • 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

  • IBM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.08% yearly.
  • 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 Y8.56%
EPS Next 2Y8.43%
EPS Next 3Y9.11%
EPS Next 5Y11.08%
Revenue Next Year6.14%
Revenue Next 2Y5.37%
Revenue Next 3Y5.33%
Revenue Next 5Y5.87%

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.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
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. Valuation

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 22.31, which indicates a rather expensive current valuation of IBM.
  • The rest of the industry has a similar Price/Earnings ratio as IBM.
  • IBM's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.16.
  • IBM is valuated rather expensively with a Price/Forward Earnings ratio of 20.54.
  • Compared to the rest of the industry, the Price/Forward Earnings ratio of IBM is on the same level as its industry peers.
  • IBM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.10.
Industry RankSector Rank
PE 22.31
Fwd PE 20.54
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

  • Based on the Enterprise Value to EBITDA ratio, IBM is valued a bit more expensive than 71.83% of the companies 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 20.83
EV/EBITDA 17.93
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.
  • IBM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.6
PEG (5Y)3.75
EPS Next 2Y8.43%
EPS Next 3Y9.11%

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

5

5. Dividend

5.1 Amount

  • IBM has a Yearly Dividend Yield of 2.59%.
  • IBM's Dividend Yield is comparable with the industry average which is at 2.64.
  • IBM's Dividend Yield is a higher than the S&P500 average which is at 1.82.
Industry RankSector Rank
Dividend Yield 2.59%

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

  • IBM pays out 59.05% 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.
DP59.05%
EPS Next 2Y8.43%
EPS Next 3Y9.11%
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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INTL BUSINESS MACHINES CORP

FRA:IBM (2/18/2026, 3:07:28 PM)

218.15

-0.3 (-0.14%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)01-28
Earnings (Next)04-22
Inst Owners64.18%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap203.91B
Revenue(TTM)67.53B
Net Income(TTM)10.59B
Analysts73.33
Price Target270.91 (24.19%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 2.59%
Yearly Dividend5.67
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)7.65%
PT rev (3m)10.63%
EPS NQ rev (1m)-2.85%
EPS NQ rev (3m)-3.92%
EPS NY rev (1m)1.96%
EPS NY rev (3m)2.32%
Revenue NQ rev (1m)0.54%
Revenue NQ rev (3m)0.45%
Revenue NY rev (1m)1.37%
Revenue NY rev (3m)1.55%
Valuation
Industry RankSector Rank
PE 22.31
Fwd PE 20.54
P/S 3.57
P/FCF 20.83
P/OCF 18.28
P/B 7.39
P/tB N/A
EV/EBITDA 17.93
EPS(TTM)9.78
EY4.48%
EPS(NY)10.62
Fwd EY4.87%
FCF(TTM)10.47
FCFY4.8%
OCF(TTM)11.93
OCFY5.47%
SpS61.09
BVpS29.53
TBVpS-42.03
PEG (NY)2.6
PEG (5Y)3.75
Graham Number80.62
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 3.32
F-Score6
WACC8.98%
ROIC/WACC0.76
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 Y8.56%
EPS Next 2Y8.43%
EPS Next 3Y9.11%
EPS Next 5Y11.08%
Revenue 1Y (TTM)7.62%
Revenue growth 3Y3.72%
Revenue growth 5Y4.12%
Sales Q2Q%12.15%
Revenue Next Year6.14%
Revenue Next 2Y5.37%
Revenue Next 3Y5.33%
Revenue Next 5Y5.87%
EBIT growth 1Y20.21%
EBIT growth 3Y14.66%
EBIT growth 5Y13.42%
EBIT Next Year45.85%
EBIT Next 3Y16.75%
EBIT Next 5Y16.03%
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 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.


How profitable is INTL BUSINESS MACHINES CORP (IBM.DE) stock?

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


What are the PE and PB ratios of INTL BUSINESS MACHINES CORP (IBM.DE) stock?

The Price/Earnings (PE) ratio for INTL BUSINESS MACHINES CORP (IBM.DE) is 22.31 and the Price/Book (PB) ratio is 7.39.


Can you provide the financial health for IBM stock?

The financial health rating of INTL BUSINESS MACHINES CORP (IBM.DE) is 2 / 10.