International Business Machines Corporation (IBM)

FairStock Score: 64/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

IBM is the kind of stalwart I can understand: software, consulting, infrastructure and financing sold to large enterprises, with hybrid cloud and AI platforms in the mix. The filed record is improving. In fiscal Q3 2026, the quarter ended 2026-09-30, revenue was $17.1B, net income $2.2B and diluted EPS $2.30, versus revenue $16.3B, net income $1.7B and EPS $1.84 in fiscal Q3 2025. For FY2025, revenue was $67.5B and net income $10.6B, up from $62.8B and $6.0B in FY2024. FairStock’s Lynch category is STALWART, based on 13.6% annual profit growth and 4.1% revenue growth over five years, which fits the profile: steady rather than explosive. Cash generation is a real strength: trailing twelve-month free cash flow was $14.0B, a 5.9% FCF yield, supporting a 2.94% dividend yield. But the balance sheet and returns need care. D/E is 1.89, ROCE is only 5.30%, and the 34.46% ROE looks leverage-assisted to me. Piotroski is 4/9 and Altman 2.76—middling, not a fortress. Valuation is the sticking point. At the 2026-10-26 close of $253.44, FairStock calculates P/E 22.49, P/B 6.93 and EV/EBITDA 16.78, while the Graham Number is $97.64, a -159.69% margin of safety. That is not Graham-cheap; it is a fair-to-full price for a good but leveraged stalwart. I would want more evidence that growth and returns can carry that price.

In plain English: IBM provides software, consulting, computer infrastructure and financing to large organizations. Its recent reports show the business is growing and generating cash: in the quarter ended September 30, 2026, revenue was $17.1 billion and net income was $2.2 billion, both above the same quarter a year earlier. At $253.44 on October 26, 2026, the shares look full rather than cheap when compared with its profits, assets and a conservative value estimate.

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Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q3 2026 10-Q (period ended 2026-09-30) · fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer