International Business Machines Corporation (IBM) Company Bio
International Business Machines provides information technology (IT) products and services worldwide. The companys Global Technology Services segment provides IT infrastructure and business process services, such as outsourcing, processing, integrated technology, cloud, and technology support. Its Global Business Services segment offers consulting and systems integration services for strategy and transformation, application innovation services, enterprise applications, and smarter analytics, and application management, maintenance, and support services. The company was founded in 1910 and is based in Armonk, New York.
IBM Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for International Business Machines Corp. To summarize, we found that International Business Machines Corp ranked in the 48th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. The most interesting components of our discounted cash flow analysis for International Business Machines Corp ended up being:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 61. Notably, its equity weight is greater than merely 10.71% of US equities in the Technology sector yielding a positive free cash flow.
Its compound free cash flow growth rate, as measured over the past 5.43 years, is -0.01% -- higher than merely 23.82% of stocks in our DCF forecasting set.
International Business Machines Corp's weighted average cost of capital (WACC) is 7%; for context, that number is higher than only 4.98% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as IBM, try QLYS, UI, KEYS, SWI, and MCHP.
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IBM (NYSE: IBM) today announced the release of a new version of its Financial Transaction Manager (FTM) solution, updated and containerized to run on Red Hat OpenShift and designed to help banks and financial institutions take advantage of the flexibility of hybrid cloud.