International Business Machines Corporation (IBM) Financial Ratios
30 years of historical data (1996–2025) · Technology · Information Technology Services
EV/EBITDA
↑
17.49
+11% vs avg
5yr avg: 15.78
30Y Low6.2·High21.8
P/FCF
↑
18.56
+14% vs avg
5yr avg: 16.30
30Y Low7.2·High67.5
P/B Ratio
↑
6.64
-5% vs avg
5yr avg: 6.99
30Y Low3.6·High12.9
ROE
↑
35.2%
↓+36% vs avg
5yr avg: 26.0%
30Y Low8%·High100%
Debt/EBITDA
↑
4.38
+5% vs avg
5yr avg: 4.17
30Y Low1.2·High5.7
Percentile shows where the current value sits in 30-year historical distribution. Sparklines show 5-year trend.
IBM Valuation Multiples
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
International Business Machines Corporation trades at 20.5x earnings, 43% below its 5-year average of 36.0x, sitting at the 70th percentile of its historical range. Compared to the Technology sector median P/E of 26.7x, the stock trades at a discount of 23%. On a free-cash-flow basis, the stock trades at 18.6x P/FCF, 14% above the 5-year average of 16.3x.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $214.8B | $281.0B | $206.0B | $150.8B | $128.5B | $120.9B | $107.8B | $114.3B | $99.5B | $137.4B | $152.0B |
| Enterprise Value | $268.4B | $334.5B | $250.5B | $197.7B | $174.7B | $169.4B | $159.7B | $174.3B | $133.9B | $172.2B | $186.3B |
| P/E Ratio → | 20.50 | 26.52 | 34.19 | 20.09 | 78.27 | 21.05 | 19.30 | 12.12 | 11.39 | 23.87 | 12.81 |
| P/S Ratio | 3.18 | 4.16 | 3.28 | 2.44 | 2.12 | 2.11 | 1.95 | 1.98 | 1.25 | 1.74 | 1.90 |
| P/B Ratio | 6.64 | 8.58 | 7.52 | 6.67 | 5.84 | 6.37 | 5.20 | 5.45 | 5.88 | 7.75 | 8.26 |
| P/FCF | 18.56 | 24.28 | 17.52 | 12.44 | 15.19 | 12.06 | 7.20 | 9.64 | 8.82 | 10.61 | 11.75 |
| P/OCF | 16.29 | 21.30 | 15.32 | 10.83 | 12.32 | 9.45 | 5.92 | 7.74 | 6.52 | 8.21 | 8.90 |
P/E links to full P/E history page with 30-year chart
IBM EV Ratios
Enterprise-value multiples — capital-structure-neutral measures of total business value
International Business Machines Corporation's enterprise value stands at 17.5x EBITDA, 11% above its 5-year average of 15.8x. This is roughly in line with the Technology sector median of 17.5x.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 4.95 | 3.99 | 3.20 | 2.89 | 2.95 | 2.89 | 3.02 | 1.68 | 2.18 | 2.33 |
| EV / EBITDA | 17.49 | 21.80 | 16.99 | 13.90 | 13.46 | 12.75 | 14.06 | 12.82 | 7.57 | 9.74 | 9.78 |
| EV / EBIT | 25.99 | 27.28 | 33.36 | 19.20 | 73.63 | 28.27 | 41.37 | 20.39 | 11.10 | 14.33 | 14.38 |
| EV / FCF | — | 28.90 | 21.30 | 16.31 | 20.64 | 16.89 | 10.67 | 14.69 | 11.87 | 13.30 | 14.41 |
IBM Profitability
Margins and return-on-capital ratios measuring operating efficiency
International Business Machines Corporation earns an operating margin of 15.3%. Return on equity of 35.2% is exceptionally high. ROIC of 9.8% represents adequate returns on invested capital.
Margins
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 59.5% | 59.5% | 56.7% | 55.4% | 54.0% | 54.9% | 55.9% | 54.6% | 46.4% | 46.7% | 48.2% |
| Operating Margin | 15.3% | 15.3% | 16.1% | 15.9% | 13.5% | 12.0% | 8.4% | 13.1% | 16.6% | 16.6% | 18.4% |
| Net Profit Margin | 15.7% | 15.7% | 9.6% | 12.1% | 2.7% | 10.0% | 10.1% | 16.3% | 11.0% | 7.3% | 14.9% |
Return on Capital
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 35.2% | 35.2% | 24.1% | 33.6% | 8.0% | 28.9% | 26.8% | 49.7% | 50.4% | 31.9% | 72.4% |
| ROA | 7.3% | 7.3% | 4.4% | 5.7% | 1.3% | 4.0% | 3.6% | 6.8% | 7.0% | 4.7% | 10.4% |
| ROIC | 9.8% | 9.8% | 10.7% | 10.7% | 9.0% | 7.4% | 4.6% | 8.5% | 19.1% | 18.7% | 22.2% |
| ROCE | 9.5% | 9.5% | 9.8% | 10.0% | 8.4% | 6.4% | 4.0% | 7.6% | 15.3% | 15.5% | 18.6% |
IBM Leverage & Debt
Solvency and debt-coverage ratios — lower is generally safer
International Business Machines Corporation carries a Debt/EBITDA ratio of 4.4x, which is highly leveraged (52% above the sector average of 2.9x). Net debt stands at $53.5B ($67.2B total debt minus $13.6B cash). Interest coverage of 6.3x is adequate, though a cyclical earnings downturn could tighten the margin of safety.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 2.05 | 2.05 | 2.13 | 2.65 | 2.45 | 2.90 | 3.14 | 3.25 | 2.71 | 2.64 | 2.29 |
| Debt / EBITDA | 4.38 | 4.38 | 3.96 | 4.22 | 4.16 | 4.15 | 5.73 | 5.01 | 2.59 | 2.65 | 2.21 |
| Net Debt / Equity | — | 1.63 | 1.62 | 2.07 | 2.09 | 2.55 | 2.50 | 2.86 | 2.03 | 1.97 | 1.87 |
| Net Debt / EBITDA | 3.49 | 3.49 | 3.02 | 3.30 | 3.55 | 3.65 | 4.57 | 4.41 | 1.95 | 1.97 | 1.80 |
| Debt / FCF | — | 4.62 | 3.78 | 3.87 | 5.45 | 4.84 | 3.47 | 5.06 | 3.05 | 2.69 | 2.66 |
| Interest Coverage | 6.34 | 6.34 | 4.39 | 6.41 | 1.95 | 5.19 | 3.00 | 8.37 | 17.59 | 18.12 | 20.57 |
IBM Liquidity & Efficiency
Short-term solvency ratios and asset-utilisation metrics
The current ratio of 0.93x is below 1.0, meaning current liabilities exceed current assets — though the company's $13.6B cash position helps mitigate short-term liquidity concerns.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 0.93 | 0.93 | 1.04 | 0.96 | 0.92 | 0.88 | 0.98 | 1.02 | 1.29 | 1.33 | 1.21 |
| Quick Ratio | 0.90 | 0.90 | 1.00 | 0.93 | 0.87 | 0.83 | 0.94 | 0.98 | 1.24 | 1.29 | 1.17 |
| Cash Ratio | 0.37 | 0.37 | 0.44 | 0.39 | 0.28 | 0.22 | 0.35 | 0.24 | 0.31 | 0.34 | 0.24 |
| Asset Turnover | — | 0.44 | 0.46 | 0.46 | 0.48 | 0.43 | 0.35 | 0.38 | 0.65 | 0.63 | 0.68 |
| Inventory Turnover | 22.42 | 22.42 | 21.10 | 23.74 | 17.94 | 15.69 | 13.22 | 16.17 | 25.36 | 26.66 | 26.66 |
| Days Sales Outstanding | — | 95.33 | 81.49 | 82.35 | 42.24 | 45.98 | 41.11 | 52.88 | 36.24 | 148.05 | 133.56 |
IBM Shareholder Yields
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
International Business Machines Corporation returns 2.9% to shareholders annually primarily through dividends. A payout ratio of 59.0% is moderate and appears sustainable, balancing shareholder returns with reinvestment capacity. The earnings yield of 4.9% (inverse of P/E) provides a useful comparison to bond yields when assessing the stock's relative attractiveness to fixed income.
Dividends
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 2.9% | 2.2% | 3.0% | 4.0% | 4.6% | 4.9% | 5.4% | 5.0% | 5.7% | 4.0% | 3.5% |
| Payout Ratio | 59.0% | 59.0% | 102.1% | 80.5% | 362.7% | 102.2% | 103.7% | 60.5% | 64.9% | 95.7% | 44.3% |
Total Shareholder Return Metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 4.9% | 3.8% | 2.9% | 5.0% | 1.3% | 4.8% | 5.2% | 8.2% | 8.8% | 4.2% | 7.8% |
| FCF Yield | 5.4% | 4.1% | 5.7% | 8.0% | 6.6% | 8.3% | 13.9% | 10.4% | 11.3% | 9.4% | 8.5% |
| Buyback Yield | 0.0% | 0.0% | 0.0% | 0.3% | 0.3% | 0.3% | 0.3% | 1.4% | 4.6% | 3.3% | 2.4% |
| Total Shareholder Yield | 2.9% | 2.2% | 3.0% | 4.3% | 4.9% | 5.1% | 5.7% | 6.4% | 10.3% | 7.3% | 5.8% |
| Shares Outstanding | — | $949M | $937M | $922M | $912M | $905M | $897M | $893M | $916M | $937M | $959M |
Peer Comparison
Compare IBM with 10 similar companies in its peer group
| Company | Market Cap | P/E | EV/EBITDA | P/FCF | Gross Margin | Op Margin | ROE | ROIC | Debt/EBITDA |
|---|---|---|---|---|---|---|---|---|---|
 IBMYou | $215B | 20.5 | 17.5 | 18.6 | 59.5% | 15.3% | 35.2% | 9.8% | 4.4 |
 ACN | $111B | 14.7 | 8.5 | 10.2 | 31.9% | 14.7% | 25.0% | 26.8% | 0.6 |
 HPE | $40B | -673.5 | 12.9 | 63.7 | 28.8% | 4.8% | 0.2% | 3.5% | 5.1 |
 DXC | $2B | 5.6 | 2.4 | 2.4 | 24.1% | 5.4% | 11.9% | 8.1% | 2.3 |
 CTSH | $25B | 11.4 | 5.9 | 9.5 | 33.7% | 16.7% | 15.2% | 18.7% | 0.4 |
 INFY | $51B | 16.4 | 10.5 | 12.4 | 30.5% | 21.1% | 28.9% | 31.8% | 0.2 |
 WIT | $21B | 15.1 | 11.3 | 12.8 | 30.7% | 17.0% | 16.8% | 13.4% | 1.1 |
 MSFT | $3.1T | 30.2 | 19.3 | 42.7 | 68.8% | 45.6% | 33.3% | 24.9% | 0.7 |
 ORCL | $533B | 42.7 | 26.3 | — | 70.5% | 30.8% | 82.4% | 12.8% | 4.4 |
 SAP | $201B | 24.5 | 15.4 | 21.6 | 73.8% | 26.7% | 15.5% | 16.0% | 0.7 |
 NOW | $95B | 55.1 | 37.0 | 20.8 | 77.5% | 13.7% | 15.5% | 12.4% | 1.3 |
| Technology Median | — | 26.7 | 17.5 | 19.5 | 48.9% | -0.6% | 2.5% | 3.0% | 2.9 |
Peer selection based on competitive and market overlap. Compare multiple stocks →
Download Financial Ratios Data
Includes 30+ ratios · 30 years · Updated daily
Full IBM Stock Analysis
Analyst consensus, bull case, AI-generated risk factors, and peer comparison — all in one place.
Should I Buy IBM Right Now?
Bull case, key risks, Wall St analyst verdict, and what council investors are saying — updated daily.
See IBM's True Return
Price is only half the story. See total return with reinvested dividends.
Launch CalculatorIs IBM Undervalued?
DCF intrinsic value, peer multiples, and analyst estimates — see what the stock is really worth.
View ValuationCompare IBM vs ACN
Side-by-side business, growth, and profitability comparison vs Accenture plc.
Start ComparisonIBM — Frequently Asked Questions
Quick answers to the most common questions about buying IBM stock.
What is International Business Machines Corporation's P/E ratio?
International Business Machines Corporation's current P/E ratio is 20.5x. The historical average is 20.1x. This places it at the 70th percentile of its historical range.
What is International Business Machines Corporation's EV/EBITDA?
International Business Machines Corporation's current EV/EBITDA is 17.5x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 11.0x.
What is International Business Machines Corporation's ROE?
International Business Machines Corporation's return on equity (ROE) is 35.2%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 44.1%.
Is IBM stock overvalued?
Based on historical data, International Business Machines Corporation is trading at a P/E of 20.5x. This is at the 70th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
What is International Business Machines Corporation's dividend yield?
International Business Machines Corporation's current dividend yield is 2.88% with a payout ratio of 59.0%.
What are International Business Machines Corporation's profit margins?
International Business Machines Corporation has 59.5% gross margin and 15.3% operating margin. Operating margin between 10-20% is typical for established companies.
How much debt does International Business Machines Corporation have?
International Business Machines Corporation's Debt/EBITDA ratio is 4.4x, indicating high leverage. A ratio above 4x may signal elevated financial risk.