Company Financial Analysis

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Growth Profitability and Financial Ratios for International Business Machines Corp
Financials
2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 TTM
Revenue USD Mil 98,786 103,630 95,758 99,871 106,916 102,874 98,367 92,793 81,741 79,919 78,367
Gross Margin % 42.2 44.1 45.7 46.1 46.9 49 49.5 50 49.8 47.9 46.3
Operating Income USD Mil 13,516 15,938 17,012 18,151 20,286 21,082 20,312 18,532 15,690 13,105 12,170
Operating Margin % 13.7 15.4 17.8 18.2 19 20.5 20.6 20 19.2 16.4 15.5
Net Income USD Mil 10,418 12,334 13,425 14,833 15,855 16,604 16,483 12,022 13,190 11,872 11,308
Earnings Per Share USD 7.15 8.89 10.01 11.52 13.06 14.37 14.94 11.9 13.42 12.38 11.95
Dividends USD 1.5 1.9 2.15 2.5 2.9 3.3 3.7 4.25 5 5.5 5.8
Payout Ratio % * 21.3 21.5 21.7 22.2 23 25.1 26.6 33 44.1 48.5
Shares Mil 1,457 1,388 1,341 1,287 1,214 1,155 1,103 1,010 983 959 943
Book Value Per Share * USD 10.06 17.34 18.77 19.16 16.88 18.85 14.39 13.77 17.98 21.2
Operating Cash Flow USD Mil 16,094 18,812 20,773 19,549 19,846 19,586 17,485 16,868 17,008 16,958 14,844
Cap Spending USD Mil -5,505 -4,887 -4,077 -4,754 -4,667 -4,717 -4,140 -4,183 -4,151 -4,150 -3,799
Free Cash Flow USD Mil 10,589 13,925 16,696 14,795 15,179 14,869 13,345 12,685 12,857 12,808 11,045
Free Cash Flow Per Share * USD 10.08 12.45 11.49 12 12.87 11.8 12.64 13.82 15.02
Working Capital USD Mil 8,867 6,569 12,933 7,554 8,805 5,808 11,196 9,822 8,235 7,613
Key Ratios -> Profitability
Margins % of Sales 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 TTM
Revenue 100 100 100 100 100 100 100 100 100 100 100
COGS 57.76 55.94 54.28 53.93 53.11 51.05 50.51 49.99 50.23 52.08 53.73
Gross Margin 42.24 44.06 45.72 46.07 46.89 48.95 49.49 50.01 49.77 47.92 46.27
SG&A 22.33 21.98 21.43 21.87 21.72 22.44 23.84 24.22 24.34 25.62 24.74
R&D 6.23 6.12 6.08 6.03 5.85 5.65 5 5.06 5.58 5.16 5.3
Other 0.59 0.45 0.35 0.37 0.76 0.65 0.74 0.7
Operating Margin 13.68 15.38 17.77 18.17 18.97 20.49 20.65 19.97 19.19 16.4 15.53
Net Int Inc & Other 0.98 0.75 1.18 1.57 0.67 1.42 -0.07 1.57 0.31 -0.97 -0.32
EBT Margin 14.67 16.13 18.94 19.75 19.64 21.91 20.58 21.54 19.51 15.43 15.21
Profitability 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 TTM
Tax Rate % 28.1 26.21 25.98 24.79 24.51 24.19 15.58 21.19 16.19 3.64 5.04
Net Margin % 10.55 11.9 14.02 14.85 14.83 15.89 16.52 12.96 16.14 14.86 14.43
Asset Turnover (Average) 0.88 0.9 0.88 0.9 0.93 0.89 0.81 0.76 0.72 0.7 0.66
Return on Assets % 9.32 10.73 12.29 13.33 13.79 14.09 13.43 9.86 11.57 10.42 9.53
Financial Leverage (Average) 4.23 8.13 4.82 4.92 5.78 6.32 5.54 9.9 7.75 6.44 6.2
Return on Equity % 36.57 58.82 74.37 64.94 73.43 85.15 79.15 69.37 100.96 73.04 61.73
Return on Invested Capital % 18.89 23.09 28.41 29.96 31.15 32.57 29.24 21.41 25.32 21.6 18.85
Interest Coverage 24.71 25.84 46.12 54.6 52.1 48.72 49.57 42.29 35.07 20.57 20.6
Key Ratios -> Growth
2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 Latest Qtr
Revenue %
Year over Year 4.9 -7.6 4.29 7.06 -2.25 -4.55 -6.98 -11.91 -2.23 -0.38
3-Year Average 4.38 1.56 0.36 1.05 2.96 -0.04 -4.61 -7.86 -7.12
5-Year Average 3.06 -0.11 1.85 3.18 1.13 -0.76 -0.63 -3.93 -5.65
10-Year Average 2.41 0.9 1.23 2.22 2.56 1.13 -0.37 -1.08 -1.34
Operating Income %
Year over Year 17.92 6.74 6.68 11.77 0.77 -8.15 -5.26 -11.8 -16.48 -8.59
3-Year Average 19.35 12.56 10.33 8.37 6.31 1.14 -4.28 -8.44 -11.3
5-Year Average 9.58 9.16 14.12 11.2 8.63 3.33 0.9 -2.87 -8.37
10-Year Average 5.69 3.62 4.55 8.12 11.64 6.41 4.95 5.28 0.94
Net Income %
Year over Year 18.39 8.85 10.49 6.89 4.72 -0.73 -27.06 9.72 -9.99
3-Year Average 15.84 12.25 12.5 8.73 7.34 3.58 -8.81 -7.39 -10.36
5-Year Average 10.22 9.75 13.33 10.81 9.77 5.97 -2.18 -2.32 -5.62
10-Year Average 6.9 5.7 6.25 7.46 16.59 8.07 3.61 5.21 2.26
EPS %
Year over Year 24.37 12.09 15.08 13.37 10.03 3.97 -20.35 12.77 -7.75 -2.01
3-Year Average 22.4 17.89 17.07 13.51 12.81 9.05 -3.05 -2.25 -6.07
5-Year Average 15.63 15.22 18.79 16.41 14.89 10.84 3.52 3.1 -1.06
10-Year Average 10.52 9.28 10 11.62 21.44 13.21 9.21 10.67 7.32
Key Ratios -> Cash Flow
Cash Flow Ratios 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 TTM
Operating Cash Flow Growth % YOY 16.89 10.42 -5.89 1.52 -1.31 -10.73 -3.53 0.83 -0.29
Free Cash Flow Growth % YOY 31.5 19.9 -11.39 2.6 -2.04 -10.25 -4.95 1.36 -0.38
Cap Ex as a % of Sales 5.57 4.72 4.26 4.76 4.37 4.59 4.21 4.51 5.08 5.19 4.85
Free Cash Flow/Sales % 10.72 13.44 17.44 14.81 14.2 14.45 13.57 13.67 15.73 16.03 14.09
Free Cash Flow/Net Income 1.02 1.13 1.24 1 0.96 0.9 0.81 1.06 0.97 1.08 0.98
Key Ratios -> Financial Health
Balance Sheet Items (in %) 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 Latest Qtr
Cash & Short-Term Investments 13.41 11.78 12.82 10.27 10.24 9.34 8.77 7.21 7.42 7.26 9.47
Accounts Receivable 23.9 25.16 24.58 24.88 25.39 25.65 25.22 27.08 25.84 24.9 22.3
Inventory 2.21 2.47 2.29 2.16 2.23 1.92 1.83 1.79 1.4 1.32 1.41
Other Current Assets 4.63 5.33 5.2 5.1 5.88 4.56 4.86 5.97 3.81 3.88 3.61
Total Current Assets 44.16 44.74 44.89 42.41 43.74 41.47 40.68 42.05 38.47 37.36 36.78
Net PP&E 12.52 13.06 12.99 12.42 11.92 11.74 10.95 9.16 9.71 9.22 9.09
Intangibles 13.61 19.27 20.82 25.23 25.43 27.71 27.77 28.64 32.13 34.81 33.51
Other Long-Term Assets 29.71 22.93 21.3 19.93 18.91 19.08 20.6 20.15 19.69 18.61 20.61
Total Assets 100 100 100 100 100 100 100 100 100 100 100
Accounts Payable 6.69 6.4 6.82 6.88 7.31 6.67 5.91 5.84 5.46 5.29 4.47
Short-Term Debt 10.16 10.26 3.82 5.97 7.27 7.7 5.44 4.88 5.85 6.4 3.53
Taxes Payable 3.05 3.51 3.72 2.85 4.15 3.67 4.33 2.58 2.75 2.5
Accrued Liabilities 8.76 10.23 8.92 8.98 8.27 8.05 6.85 8.55 7.16 7.05 6.8
Other Short-Term Liabilities 8.14 11.85 9.95 10.21 10.47 10.03 9.95 10.11 9.97 9.39 8.75
Total Current Liabilities 36.79 38.74 33.02 35.75 36.18 36.59 31.81 33.69 31.01 30.88 26.06
Long-Term Debt 19.13 20.72 20.12 19.26 19.63 20.21 26.03 29.84 30.25 29.5 33.98
Other Long-Term Liabilities 20.44 28.24 26.1 24.68 26.9 27.38 24.1 26.37 25.83 24.09 23.83
Total Liabilities 76.36 87.71 79.24 79.69 82.7 84.18 81.94 89.9 87.09 84.47 83.86
Total Stockholders' Equity 23.64 12.29 20.76 20.31 17.3 15.82 18.06 10.1 12.91 15.53 16.14
Total Liabilities & Equity 100 100 100 100 100 100 100 100 100 100 100
Liquidity/Financial Health 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 Latest Qtr
Current Ratio 1.2 1.15 1.36 1.19 1.21 1.13 1.28 1.24 1.24 1.21 1.41
Quick Ratio 1.01 0.95 1.13 0.98 0.98 0.95 1.07 1.02 1.07 1.04 1.22
Financial Leverage 4.23 8.13 4.82 4.92 5.78 6.32 5.54 9.9 7.75 6.44 6.2
Debt/Equity 0.81 1.69 0.97 0.95 1.14 1.28 1.44 2.96 2.34 1.9 2.11
Key Ratios -> Efficiency Ratios
Efficiency 2007-12 2008-12 2009-12 2010-12 2011-12 2012-12 2013-12 2014-12 2015-12 2016-12 TTM
Days Sales Outstanding 44.81 43.28 45.66 43.58 42.04 44.01 44.99 47.29 48.07 45.15 42.48
Days Inventory 17.51 16.89 18.24 16.75 16.22 16.44 16.37 17.36 16.24 13.61 14.91
Payables Period 51.23 47.44 50.74 51.64 52.46 55.44 54.89 56.36 57.31 53.65 46.43
Cash Conversion Cycle 11.08 12.74 13.16 8.69 5.79 5 6.47 8.29 7.01 5.11 10.95
Receivables Turnover 8.15 8.43 7.99 8.38 8.68 8.29 8.11 7.72 7.59 8.08 8.59
Inventory Turnover 20.85 21.61 20.01 21.79 22.51 22.21 22.3 21.02 22.47 26.82 24.48
Fixed Assets Turnover 6.69 7.05 6.73 7.07 7.64 7.5 7.17 7.55 7.6 7.41 7.07
Asset Turnover 0.88 0.9 0.88 0.9 0.93 0.89 0.81 0.76 0.72 0.7 0.66