INTERNATIONAL BUSINESS MACHINES CORP

IBM

International Business Machines Corporation, together with its subsidiaries, provides integrated solutions and services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It operates through Software, Consulting, Infrastructure, and Financing segments.

Country: United StatesPrice: $234.32Market Cap: $220.8B

Company Profile

Industry: Computers
SIC Sector: Industrial Machinery & Computing
Size: Mega Cap($220.8B)
Revenue: $67.5B+7.6% YoY
Net Income: $10.6B+75.9% YoY

Financial Snapshot

Operating Margin--
Return on Equity32.4%
Debt / Equity1.68
Current Ratio0.96
EPS (Diluted)$11.17+73.7%
Shares Retired−1.2% / −2.4% 2y

Similar Companies

AAPLApple Inc.
$4.46T
CSCOCISCO SYSTEMS, INC.
$440.2B
HPE-PCHewlett Packard Enterprise Co
$198.1B
WDCWESTERN DIGITAL CORP
$175.4B

Shareholder Return

Fiscal 2025

Issued 1.2% of shares last year, 2.4% issued over two.

Buybacks
—
Dividends
$6.3B

What drove EPS

A buyback raises earnings per share without the company earning more. This splits each year's change into the two.

FY22
−71.7% = −71.5% + −0.7%
FY23
352.2% = 357.7% + −1.2%
FY24
−21.0% = −19.7% + −1.6%
FY25
73.7% = 75.9% + −1.2%
Earnings Fewer shares More shares

The two parts do not sum exactly to the total — the difference is the cross-term, plus preferred capital where the company has any. It is left visible rather than distributed into the other two.

Share count is the denominator the filer used for diluted EPS, recovered as net income ÷ EPS — not the balance-sheet count, which is a point-in-time figure and would put the timing difference into this split. Years with a loss are omitted: a smaller share count makes a loss per share larger, so the decomposition inverts.

Company Financials

Annual data (10-K) · Last 5 years

MetricFY 2025FY 2024FY 2023FY 2022FY 2021
Market Cap$220.8B$229.6Best.$157.2Best.$108.8Best.$101.9Best.
Revenue$67.5B↑8%$62.8B↑1%$61.9B↑2%$60.5B↑6%$57.4B
Operating Income----------
Net Income$10.6B↑76%$6.0B↓20%$7.5B↑358%$1.6B↓71%$5.7B
EPS (Diluted)$11.17↑74%$6.43↓21%$8.14↑352%$1.80↓72%$6.35
Gross Margin58.2%↑3%56.7%↑2%55.4%↑3%54.0%↓2%54.9%
Operating Margin—————
ROE32.4%↑47%22.1%↓34%33.3%↑346%7.5%↓75%30.4%
Total Debt$54.8B↑10%$49.9B$50.1B↑9%$46.2B↑3%$44.9B
Shareholders' Equity$32.6B↑20%$27.3B↑21%$22.5B↑3%$21.9B↑16%$18.9B
Current Ratio0.96↓8%1.04↑8%0.96↑4%0.92↑5%0.88
Debt / Equity1.68↓8%1.83↓18%2.22↑6%2.10↓11%2.38
Operating Cash Flow$13.2B↓2%$13.4B↓3%$13.9B↑34%$10.4B↓18%$12.8B
Free Cash Flow$12.1B↓2%$12.4B↓2%$12.7B↑40%$9.1B↓15%$10.7B
Scored from 10-K1d ago
MetricMarks

Risk-Aware Value

Akre

Three-Legged Stool

Druckenmiller

Macro-Enhanced Growth

Spier

Value Checklist

Pabrai

Dhandho Framework

Munger

Quality Focus

Ackman

Activist Value

Piotroski

F-Score

Greenblatt

Magic Formula

Lynch

GARP

Buffett

Quality Compounder

Graham

Defensive Value

VerdictHOLDPASSBUYBUYHOLDHOLDHOLDHOLDNot rankedPASSFAILFAIL
Score
Analysis
Intrinsic ValueN/A
Margin of Safety-98.4%+37.6%+10.5%-141.8%-263.4%-68.6%-30.8%-572.6%N/A-69.4%-69.2%-150.4%
Data As Of10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)10-K (2026-08-15)

Where They Agree

  • Efficiency

    All 6 investors flag IBM's efficiency

    ROIC (high and growing)
    ✗AkreROIC > 15% for 3+ years
    Reinvestment Rate x ROIC
    ✗AkreReinvestment Rate * ROIC > 10%
    Return on Invested Capital
    ✗Munger> 15%
    Current Ratio Change YoY1.04 -> 0.96
    ✗PiotroskiIncreased YoY
    Show 5 more metrics ▾
    Revenue / Total Assets Change YoY0.46x -> 0.44x
    ✗PiotroskiImproved YoY
    EBIT / (NWC + Net Fixed Assets)
    ✗Greenblatt> 25%
    ROIC (3-5 yr avg)
    ✗Buffett> 10%
    ROIC - WACC
    ✗BuffettPositive (WACC = 10%)
    Current Ratio0.96
    ✗Graham>= 2.0

Where They Disagree

  • Profitability

    4 of 11 pass — Marks, Spier, Pabrai +4 more object

    Discount to Intrinsic Value-86.6% (IV=$128.70 vs Price=$240.21)
    ✗Marks>= 20% below intrinsic value
    Positive Net Income Frequency18/18 years positive
    ✓MarksPositive net income in >= 7 of last 10 years
    Return on Equity29.3% (3-yr avg)
    ✓AkreROE > 20% (3-year avg)
    EPS Growth AccelerationLatest: 73.7%, Prior: -21.0%
    ✓DruckenmillerAccelerating EPS growth
    Show 19 more metrics ▾
    Margin of SafetyP/E=21.5x, P/B=6.9x
    ✗SpierP/E < 15 AND P/B < 2.0✗PabraiP/B < 1.5 or P/E < 15
    Operating Income / Revenue
    ✗Ackman>= 15%
    Net Income / Shareholders Equity32.4%
    ✓Ackman>= 15%
    Net Income / Total Assets6.97%
    ✓PiotroskiROA > 0
    ROA Change YoY4.39% -> 6.97% (delta: +2.58%)
    ✓PiotroskiCurrent ROA > Prior ROA
    (CFO / Total Assets) vs ROACFO/Assets=8.69%, ROA=6.97%
    ✓PiotroskiCFO/Assets > ROA
    Gross Margin Change YoY56.7% -> 58.2%
    ✓PiotroskiImproved YoY
    EBIT / Enterprise Value
    ✗Greenblatt> 10%
    Earnings Yield + ROC AssessmentEY=None, ROC=None
    ✗GreenblattBoth EY > 10% and ROC > 25%
    3-5 Year EPS CAGR12.4%
    ✓Lynch15-30% (Fast Grower); > 0% to pass
    ROE32.4%
    ✓Lynch> 15%
    Net Income Positive (10+ years)18/18 years positive
    ✓BuffettPositive every year for 10+ years
    ROE (5-yr avg)25.1%
    ✓Buffett> 15% (5-yr avg)
    Operating Margin (10-yr trend)
    ✗BuffettStable or rising over 10 years
    Free Cash Flow Proxy$11.8B
    ✗BuffettPositive and growing
    Earnings Variance (10-yr CoV)0.34
    ✗BuffettCoV < 0.3
    Retained Earnings Effectiveness83.15x
    ✓Buffett$1 retained -> > $1 market value created
    Positive EPS (10 years)18/18 years positive
    ✓GrahamPositive EPS every year for 10 years
    EPS Growth (3-yr avg, 10-yr window)-15.4%
    ✗Graham>= 33% growth
  • Debt & Leverage

    1 of 8 pass — Marks, Akre, Munger +4 more object

    Interest Coverage & Debt/EBITDA
    ✗MarksInterest Coverage > 3x; Debt/EBITDA < 4x
    Debt Levels1.68
    ✗AkreDebt/Equity < 0.3✗MungerDebt/Equity < 0.5
    Total Debt / Shareholders Equity1.68
    ✗Ackman<= 1.0
    LT Debt / Total Assets Change36.37% -> 36.10%
    ✓PiotroskiDecreased YoY
    Show 4 more metrics ▾
    Total Debt / Equity1.68
    ✗Lynch< 0.33
    Cash - Long-term Debt$-41.2B
    ✗LynchPositive preferred
    Debt/Equity & Interest CoverageD/E: 1.68, IC: N/A
    ✗BuffettD/E < 0.5 AND Interest Coverage > 5x
    LT Debt vs Net Current AssetsLT Debt $54.8B vs NCA $-1.7B
    ✗GrahamLT Debt <= Net Current Assets
  • Valuation

    3 of 9 pass — Marks, Spier, Pabrai +3 more object

    P/B or P/E vs. Historical AverageP/E=21.5x, P/B=6.9x
    ✗MarksP/E < 15 or P/B < 2.0
    Discount to Intrinsic Value-86.6% (IV=$128.70 vs Price=$240.21)
    ✗Marks>= 20% below intrinsic value
    Price vs. 200-day MAQualitative
    ✓DruckenmillerPrice above 200-day moving average
    Margin of SafetyP/E=21.5x, P/B=6.9x
    ✗SpierP/E < 15 AND P/B < 2.0
    Show 9 more metrics ▾
    P/E or FCF YieldP/E=21.5x, FCF Yield=5.4%
    ✗PabraiP/E < 15 or FCF Yield > 10%
    Valuation ReasonablenessP/E=21.5x, OE Yield=5.2%
    ✓MungerP/E < 25 or Owner Earnings Yield > 5%
    Price / FCF per Share18.6x
    ✓Ackman<= 25
    EBIT / Enterprise Value
    ✗Greenblatt> 10%
    Earnings Yield + ROC AssessmentEY=None, ROC=None
    ✗GreenblattBoth EY > 10% and ROC > 25%
    P/E / EPS Growth Rate1.74
    ✗Lynch< 1.0 (ideally < 0.5)
    Price / 3-yr avg EPS28.0x
    ✗Graham<= 15x
    Price-to-Book Ratio6.9x
    ✗Graham<= 1.5x
    P/E x P/B193.00
    ✗Graham<= 22.5
  • Cash Flow

    3 of 6 pass — Pabrai, Lynch and Buffett object

    FCF Positive18/18 years FCF positive
    ✓MarksPositive FCF in majority of recent years
    P/E or FCF YieldP/E=21.5x, FCF Yield=5.4%
    ✗PabraiP/E < 15 or FCF Yield > 10%
    (OCF - CapEx) / Market Cap5.4%
    ✓Ackman>= 4%
    Price / FCF per Share18.6x
    ✓Ackman<= 25
    Show 4 more metrics ▾
    Operating Cash Flow$13.2B
    ✓PiotroskiCFO > 0
    (CFO / Total Assets) vs ROACFO/Assets=8.69%, ROA=6.97%
    ✓PiotroskiCFO/Assets > ROA
    FCF Positive and Growing$12.1B
    ✗LynchPositive and growing
    Free Cash Flow Proxy$11.8B
    ✗BuffettPositive and growing
  • Growth

    2 of 5 pass — Ackman, Lynch and Graham object

    Positive Net Income Frequency18/18 years positive
    ✓MarksPositive net income in >= 7 of last 10 years
    EPS Growth AccelerationLatest: 73.7%, Prior: -21.0%
    ✓DruckenmillerAccelerating EPS growth
    Revenue Growth RateLatest: 7.6%, Prior: 1.4%
    ✓DruckenmillerRevenue growth accelerating
    3yr Median Revenue Growth2.2%
    ✗Ackman>= 5%
    Show 5 more metrics ▾
    Positive EPS Growth Frequency3/5 years with positive EPS growth
    ✓AckmanPositive EPS growth in >= 3 of last 5 years
    P/E / EPS Growth Rate1.74
    ✗Lynch< 1.0 (ideally < 0.5)
    3-5 Year EPS CAGR12.4%
    ✓Lynch15-30% (Fast Grower); > 0% to pass
    Inventory Growth vs Revenue GrowthInv: -5.4% vs Rev: 7.6%
    ✓LynchInventory growth < Revenue growth
    EPS Growth (3-yr avg, 10-yr window)-15.4%
    ✗Graham>= 33% growth
  • Verdicts

    Split decision: 5 HOLD · 2 PASS · 2 BUY · 2 FAIL

    Overall verdict
    •MarksHOLD (5/8)✓AkrePASS (3/7)✓DruckenmillerBUY (7/7)✓SpierBUY (7/8)•PabraiHOLD (5/8)•MungerHOLD (5/7)•AckmanHOLD (6/9)•PiotroskiHOLD (F-Score 6)•GreenblattNot ranked✓LynchPASS (PEG 1.74)✗BuffettFAIL (3/9)✗GrahamFAIL (3/9)
  • Valuation models

    Models split on IBM at $234.32 — fair values range $34.84–$375.35

    Marks fair value$118.08
    ✗Marks-98.4% margin vs $234.32
    Akre fair value$375.35
    ✓Akre+37.6% margin vs $234.32
    Druckenmiller fair value$261.70
    ✓Druckenmiller+10.5% margin vs $234.32
    Spier fair value$96.90
    ✗Spier-141.8% margin vs $234.32
    Show 7 more metrics ▾
    Pabrai fair value$64.48
    ✗Pabrai-263.4% margin vs $234.32
    Munger fair value$138.99
    ✗Munger-68.6% margin vs $234.32
    Ackman fair value$179.18
    ✗Ackman-30.8% margin vs $234.32
    Piotroski fair value$34.84
    ✗Piotroski-572.6% margin vs $234.32
    Lynch fair value$138.35
    ✗Lynch-69.4% margin vs $234.32
    Buffett fair value$138.50
    ✗Buffett-69.2% margin vs $234.32
    Graham fair value$93.58
    ✗Graham-150.4% margin vs $234.32

Historical Score Timeline

Industry Peers

Similar companies in Computers

IBM vs Peers — Financial Grading

Revenue$67.5BTop 25%
Net Income$10.6BTop 25%
ROE32.4%Median
D/E1.68Bottom 25%
Op. Margin—
Curr. Ratio0.96Bottom 25%
CompanyMarket CapPriceRevenueNet IncomeROED/EOp. MarginCurr. RatioGrahamBuffettLynchGreenblattPiotroski
Apple Inc.AAPL$4.46T$305.93$416.2B$112.0B151.9%1.4032.0%0.891/96/93/71/3F-Score 8
CISCO SYSTEMS, INC.CSCO$440.2B$111.68$56.7B$10.2B21.7%0.5620.8%1.004/97/93/70/3F-Score 8
Hewlett Packard Enterprise CoHPE-PC$198.1B$150.26$34.3B$57.0M0.2%1.03-1.3%1.011/91/91/70/3F-Score 4
WESTERN DIGITAL CORPWDC$175.4B$508.80$9.5B$1.9B35.6%1.3124.5%1.081/91/93/71/3F-Score 4
NCR Voyix CorpNCRRP$138.6B$1002.00$2.7B$62.0M6.5%1.171.0%1.041/93/90/70/3F-Score 3
Fortinet, Inc.FTNT$117.4B$160.01$6.8B$1.9B149.8%0.8130.7%1.172/95/95/71/3F-Score 6
NetApp, Inc.NTAP$40.6B$207.08$6.2B$1.3B94.4%1.8426.8%1.443/95/93/71/3F-Score 8
HP INCHPQ$27.5B$30.11$55.3B$2.5B-730.9%-30.385.7%0.773/93/91/71/3F-Score 5