International Business Machines (IBM) vs. Its Competitors Head to Head Comparison

International Business Machines (NYSE:IBM) is one of 271 publicly-traded companies in the “IT Services” industry, but how does it contrast to its rivals? We will compare International Business Machines to similar companies based on the strength of its risk, institutional ownership, analyst recommendations, profitability, earnings, dividends and valuation.

Profitability

This table compares International Business Machines and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
International Business Machines	15.99%	34.37%	7.63%
International Business Machines Competitors	-191.32%	-32.18%	-8.63%

Institutional and Insider Ownership

59.0% of International Business Machines shares are owned by institutional investors. Comparatively, 36.4% of shares of all “IT Services” companies are owned by institutional investors. 0.3% of International Business Machines shares are owned by insiders. Comparatively, 20.4% of shares of all “IT Services” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares International Business Machines and its rivals gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
International Business Machines	$67.53 billion	$10.59 billion	21.00
International Business Machines Competitors	$3.24 billion	$227.67 million	-26.87

International Business Machines has higher revenue and earnings than its rivals. International Business Machines is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for International Business Machines and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
International Business Machines	2	13	19	0	2.50
International Business Machines Competitors	1992	5656	9478	342	2.47

International Business Machines presently has a consensus price target of $266.88, indicating a potential upside of 8.35%. As a group, “IT Services” companies have a potential upside of 29.45%. Given International Business Machines’ rivals higher probable upside, analysts plainly believe International Business Machines has less favorable growth aspects than its rivals.

Dividends

International Business Machines pays an annual dividend of $6.76 per share and has a dividend yield of 2.7%. International Business Machines pays out 57.6% of its earnings in the form of a dividend. As a group, “IT Services” companies pay a dividend yield of 2.3% and pay out 71.0% of their earnings in the form of a dividend. International Business Machines has raised its dividend for 30 consecutive years. International Business Machines is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Risk and Volatility

International Business Machines has a beta of 0.78, indicating that its stock price is 22% less volatile than the S&P 500. Comparatively, International Business Machines’ rivals have a beta of 2.16, indicating that their average stock price is 116% more volatile than the S&P 500.

Summary

International Business Machines beats its rivals on 11 of the 15 factors compared.

About International Business Machines

International Business Machines Corporation, together with its subsidiaries, provides integrated solutions and services worldwide. The company operates through Software, Consulting, Infrastructure, and Financing segments. The Software segment offers a hybrid cloud and AI platforms that allows clients to realize their digital and AI transformations across the applications, data, and environments in which they operate. The Consulting segment focuses on skills integration for strategy, experience, technology, and operations by domain and industry. The Infrastructure segment provides on-premises and cloud based server, and storage solutions, as well as life-cycle services for hybrid cloud infrastructure deployment. The Financing segment offers client and commercial financing, facilitates IBM clients’ acquisition of hardware, software, and services. The company has a strategic partnership to various companies including hyperscalers, service providers, global system integrators, and software and hardware vendors that includes Adobe, Amazon Web services, Microsoft, Oracle, Salesforce, Samsung Electronics and SAP, and others. The company was formerly known as Computing-Tabulating-Recording Co. International Business Machines Corporation was incorporated in 1911 and is headquartered in Armonk, New York.