International Business Machines Corporation

SNSE:IBM Stock Report

Market Cap: US$195.0b

International Business Machines Valuation

Is IBM undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of IBM when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: IBM ($159.98) is trading below our estimate of fair value ($208.14)

Significantly Below Fair Value: IBM is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for IBM?

Other financial metrics that can be useful for relative valuation.

IBM key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue3.9x
Enterprise Value/EBITDA16.5x
PEG Ratio2.9x

Price to Earnings Ratio vs Peers

How does IBM's PE Ratio compare to its peers?

The above table shows the PE ratio for IBM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average25.4x
ACN Accenture
31.8x9.5%US$225.3b
TCS Tata Consultancy Services
31.7x10.1%₹15.0t
SONDA Sonda
9.6x14.4%CL$295.8b
INFY Infosys
28.4x8.4%₹7.7t
IBM International Business Machines
30.6x10.5%US$195.0b

Price-To-Earnings vs Peers: IBM is expensive based on its Price-To-Earnings Ratio (30.6x) compared to the peer average (25.4x).

Price to Earnings Ratio vs Industry

How does IBM's PE Ratio compare vs other companies in the Global IT Industry?

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.4%
 n/an/an/a
No. of CompaniesPE048121620

Fetching data

0 CompaniesPrice / EarningsEstimated GrowthMarket Cap
Industry Avg.n/a14.4%
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No more companies

Price-To-Earnings vs Industry: IBM is expensive based on its Price-To-Earnings Ratio (30.6x) compared to the Global IT industry average (23.5x).

Price to Earnings Ratio vs Fair Ratio

What is IBM's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

IBM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio30.6x
Fair PE Ration/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate IBM's Price-To-Earnings Fair Ratio for valuation analysis.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst IBM forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
CurrentUS$159.98
US$214.21
+33.9%
18.3%US$260.00US$139.00n/a18
Nov ’25US$159.98
US$214.21
+33.9%
18.3%US$260.00US$139.00n/a18
Oct ’25US$159.98
US$196.74
+23.0%
15.1%US$250.00US$139.00n/a18
Sep ’25US$159.98
US$188.49
+17.8%
13.7%US$222.00US$130.00n/a19
Aug ’25US$159.98
US$186.39
+16.5%
14.2%US$222.00US$130.00n/a19
Jul ’25US$159.98
US$179.83
+12.4%
13.4%US$215.00US$130.00n/a19
Jun ’25US$159.98
US$180.23
+12.7%
13.9%US$215.00US$130.00n/a18
May ’25US$159.98
US$183.29
+14.6%
12.9%US$215.00US$130.00n/a18
Apr ’25US$159.98
US$185.93
+16.2%
15.6%US$224.00US$125.00n/a18
Mar ’25US$159.98
US$180.93
+13.1%
15.2%US$224.00US$125.00n/a19
Feb ’25US$159.98
US$178.51
+11.6%
16.3%US$224.00US$125.00n/a19
Jan ’25US$136.51
US$151.59
+11.0%
14.9%US$210.00US$110.00n/a17
Dec ’24US$136.51
US$146.50
+7.3%
11.2%US$179.00US$110.00n/a16
Nov ’24US$136.51
US$146.13
+7.0%
11.3%US$179.00US$110.00US$159.9816
Oct ’24US$136.51
US$146.88
+7.6%
12.0%US$188.00US$110.00US$159.9816
Sep ’24US$136.51
US$144.47
+5.8%
10.3%US$175.00US$110.00US$159.9815
Aug ’24US$136.51
US$144.63
+5.9%
10.0%US$175.00US$110.00US$159.9816
Jul ’24US$136.51
US$139.35
+2.1%
8.4%US$162.00US$110.00US$159.9814
Jun ’24US$136.51
US$138.78
+1.7%
8.3%US$162.00US$110.00US$159.9814
May ’24US$136.51
US$139.50
+2.2%
8.3%US$162.00US$110.00US$159.9814
Apr ’24US$136.51
US$144.27
+5.7%
9.0%US$165.00US$110.00US$159.9815
Mar ’24US$136.51
US$144.67
+6.0%
8.9%US$165.00US$110.00US$159.9815
Feb ’24US$136.51
US$144.67
+6.0%
8.9%US$165.00US$110.00US$159.9815
Jan ’24US$136.51
US$141.02
+3.3%
9.2%US$165.00US$111.00US$136.5115
Dec ’23US$136.51
US$140.35
+2.8%
8.5%US$160.00US$111.00US$136.5115
Nov ’23US$136.51
US$140.35
+2.8%
8.5%US$160.00US$111.00US$136.5115

Analyst Forecast: Target price is less than 20% higher than the current share price.

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