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IBM (NYSE:IBM)

US4592001014

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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IBM stock research in summary

ibm.com


ANALYSIS: With an Obermatt Combined Rank of 72 (better than 72% compared with investment alternatives), IBM (IT Consulting & oth. Services, USA) shares have above-average financial characteristics compared with similar stocks. Shares of IBM are a good value (attractively priced) with a consolidated Value Rank of 85 (better than 85% of alternatives), show above-average growth (Growth Rank of 61) but are riskily financed (Safety Rank of 38), which means above-average debt burdens. ...read more


RECOMMENDATION: A Combined Rank of 72, is a buy recommendation based on IBM's financial characteristics. As the company IBM's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 85) and above-average growth (Obermatt Growth Rank of 61), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 38) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more


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Country USA
Industry IT Consulting & oth. Services
Index Dow Jones, Artificial Intelligence, Dividends USA, Diversity USA, Renewables Users, Recycling, S&P 500
Size class XX-Large

This stock has achievements: Insight 2023-03-16, Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.




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Research History: IBM

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
SENTIMENT
SENTIMENT
360° VIEW
360° VIEW

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better IBM is in the corresponding investment strategy.
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Combined financial peformance in Detail

ANALYSIS: With an Obermatt Combined Rank of 72 (better than 72% compared with investment alternatives), IBM (IT Consulting & oth. Services, USA) shares have above-average financial characteristics compared with similar stocks. Shares of IBM are a good value (attractively priced) with a consolidated Value Rank of 85 (better than 85% of alternatives), show above-average growth (Growth Rank of 61) but are riskily financed (Safety Rank of 38), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 72, is a buy recommendation based on IBM's financial characteristics. As the company IBM's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 85) and above-average growth (Obermatt Growth Rank of 61), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 38) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
COMBINED
COMBINED

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of IBM the better the performance.


Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 85 (better than 85% compared with alternatives) for 2024, IBM shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for IBM. Price-to-Sales (P/S) is 52, which means that the stock price compared with what market professionals expect for future sales is lower than for 52% of comparable companies, indicating a good value concerning IBM's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 64% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 99 (dividends are expected to be higher than 99% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 67% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for IBM to 33. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 85, is a buy recommendation based on IBM's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more


VALUE METRICS 2021 2022 2023 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)
DIVIDEND YIELD
DIVIDEND YIELD
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of IBM; except for dividend yield where the rank is higher, the higher the yield.


Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 61 (better than 61% compared with alternatives), IBM shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for IBM. Capital Growth has a rank of 84, which means that currently professionals expect the company to grow its invested capital more than 31% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 73 (above 73% of alternative investments). But Sales Growth has only a rank of 27, which means that, currently, professionals expect the company to grow less than 73% of its competitors, and Profit Growth is also low at a rank of 31. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 61, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for IBM, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS 2021 2022 2023 2024
REVENUE GROWTH
REVENUE GROWTH
PROFIT GROWTH
PROFIT GROWTH
CAPITAL GROWTH
CAPITAL GROWTH
STOCK RETURNS
STOCK RETURNS
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of IBM.


Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 38 (better than 38% compared with alternatives), the company IBM has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of IBM is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for IBM. Liquidity is at 73, meaning the company generates more profit to service its debt than 73% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 27, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 73% of its competitors. Leverage is also high at a rank of 22, which means that the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 38 (worse than 62% compared with alternatives), IBM has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS 2021 2022 2023 2024
LEVERAGE
LEVERAGE
REFINANCING
REFINANCING
LIQUIDITY
LIQUIDITY
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of IBM and the more cash is available to service its debt.


Sentiment Metrics in Detail

SENTIMENT 2021 2022 2023 2024
ANALYST OPINIONS
ANALYST OPINIONS
OPINIONS CHANGE
OPINIONS CHANGE
PRO HOLDINGS
PRO HOLDINGS
MARKET PULSE
MARKET PULSE
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for IBM.
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Free stock analysis by the purely fact based Obermatt Method for IBM from December 19, 2024.

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