International Business Machines (XBRU:IBMA) ROCE % : 5.85% (As of Mar. 2024)

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What is International Business Machines ROCE %?

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. International Business Machines's annualized ROCE % for the quarter that ended in Mar. 2024 was 5.85%.

International Business Machines ROCE % Historical Data

The historical data trend for International Business Machines's ROCE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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International Business Machines ROCE % Chart

International Business Machines Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROCE %

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8.57

3.35

5.59

2.44

10.46

International Business Machines Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
ROCE %	Get a 7-Day Free Trial															5.75	9.58	9.21	16.67	5.85

International Business Machines ROCE % Calculation

International Business Machines's annualized ROCE % for the fiscal year that ended in Dec. 2023 is calculated as:

ROCE %	=	EBIT	/	( (Capital Employed	+	Capital Employed)	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	10297	/	( ( (127243 - 31505)	+	(135241 - 34122) )	/ 2 )
	=	10297	/	( (95738	+	101119)	/ 2 )
	=	10297	/	98428.5
	=	10.46 %

International Business Machines's ROCE % of for the quarter that ended in Mar. 2024 is calculated as:

ROCE %	=	EBIT ⁽¹⁾	/	( (Capital Employed	+	Capital Employed)	/ count )
		(Q: Mar. 2024 )		(Q: Dec. 2023 )		(Q: Mar. 2024 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(Q: Mar. 2024 )		(Q: Dec. 2023 )		(Q: Mar. 2024 )
	=	6024	/	( ( (135241 - 34122)	+	(137169 - 32397) )	/ 2 )
	=	6024	/	( ( 101119	+	104772 )	/ 2 )
	=	6024	/	102945.5
	=	5.85 %

(1) Note: The EBIT data used here is four times the quarterly (Mar. 2024) EBIT data.

International Business Machines (XBRU:IBMA) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

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International Business Machines (XBRU:IBMA) Business Description

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GURUFOCUS.COM » STOCK LIST » Technology » Software » International Business Machines Corp (XBRU:IBMA) » Definitions » ROCE %

Comparable Companies

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IBM:USA IBM:Mexico 1IBM:Italy IBMd:UK IBM:UK IBM:Germany IBM:Chile IBM:Canada IBMB34:Brazil IBM:Austria IBM:Argentina

Address

One New Orchard Road, Armonk, NY, USA, 10504

Website

http://www.ibm.com

IBM looks to be a part of every aspect of an enterprise's IT needs. The company primarily sells software, IT services, consulting, and hardware. IBM operates in 175 countries and employs approximately 350,000 people. The company has a robust roster of 80,000 business partners to service 5,200 clients—which includes 95% of all Fortune 500. While IBM is a B2B company, IBM's outward impact is substantial. For example, IBM manages 90% of all credit card transactions globally and is responsible for 50% of all wireless connections in the world.

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