Huge revenue decrease IBM expected, relatively high dividend

Over the past book year the analyst estimate the revenue to be around 81,79 billion dollars. This is hugely less then the 2014's revenue of 92,79 billion dollars. The analyst's consensus for 2015 is a net profit of 14,55 billion dollars.

For 2015 the consensus of the earnings per share of IBM is at profit of 13,51 dollars. Based on this estimate the price/earnings ratio is at 9,75.

The consensus of the dividends per share is at 4,89 dollars. Consequently the dividend return is around 3,71 percent. The average stock in the hardware sector has a dividend yield of around 0,82 percent.

2009 worst year for IBM


The matrix above shows IBM's historical returns expressed in the different entry years in the left axis.

The year 2009 was with a price loss of 75 percent the worst year investors. 2015 was with a return of 153 percent by far the best year since 2008. Who bought the share in 2008 (price at that time 289,00 dollars) now has a price loss of 54 percent.

The stock now trades at 131,72 dollars. This equals 60 times the 2014's earnings per share.


The graph above shows the developments of IBM's stock price (blue) and revenue (red) for the period 2008 till 2015 (the analyst's expectations. It seems that the hardware & equipment company's revenue hardly is connected with the stock price: the correlation equals 0,13.

Highlights hardware sector


IBM's book value/price (also book to price ratio) equals 1,55. The hardware & equipment company's CAPE equals 3.81. The stock now trades at 131,72 dollars. This equals 60 times the 2014's earnings per share.

IBM is covered by 11 analysts. The average target price for IBM is at 147,09 dollars. This is 11,67 percent more then the current stock price of 131,72 dollars. Within the sector hardware sector the analysts mostly prefer Cognizant, Apple and Heidelberger Druckmaschinen .

The three most recent recommendations for the hardware sector are from Sanford C. Bernstein & Co (hold, 140,00 dollars), Deutsche Bank (hold, 150,00 dollars) and BMO Capital Markets (hold, 155,00 dollars).