International Business Machines (CHIX:IBMd) Cash Conversion Cycle Explanation
Generally, the lower this number is, the better for the company. Although it should be combined with other metrics (such as ROE % and ROA %), it can be especially useful for comparing close competitors, because the company with the lowest CCC is often the one with better management.
Be Aware
CCC is most effective with retail-type companies, which have inventories that are sold to customers. Consulting businesses, software companies and insurance companies are all examples of companies for whom this metric is meaningless.
The CCC is one of several tools that can help you evaluate management, especially if it is calculated for several consecutive time periods and for several competitors. Decreasing or steady CCCs are good, while rising ones should motivate you to dig a bit deeper.
International Business Machines Cash Conversion Cycle Related Terms
International Business Machines Cash Conversion Cycle Historical Data
* 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.
International Business Machines Cash Conversion Cycle Chart
CHIX:IBMD vs ACN, FISV, FIS: Cash Conversion Cycle Comparison
For the Information Technology Services subindustry, International Business Machines's Cash Conversion Cycle, along with its competitors' market caps and Cash Conversion Cycle data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
International Business Machines Cash Conversion Cycle vs Software Industry
For the Software industry and Technology sector, International Business Machines's Cash Conversion Cycle distribution charts can be found below:
* The bar in red indicates where International Business Machines's Cash Conversion Cycle falls into.
International Business Machines Cash Conversion Cycle Calculation
Cash Conversion Cycle (CCC) measures how fast a company can convert cash on hand into even more cash on hand. This metric looks at the amount of time needed to sell inventory, the amount of time needed to collect receivables and the length of time the company is afforded to pay its bills without incurring penalties.
Cash Conversion Cycle is one of several measures of management effectiveness.
* 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.
International Business Machines (CHIX:IBMD) has a Cash Conversion Cycle of 1.92 as of Mar. 2026. Cash conversion cycle equals sum of days inventory and days sales outstanding less days payable. View historical data on International Business Machines and its competitors.
Is International Business Machines' Cash Conversion Cycle too high?
International Business Machines' current Cash Conversion Cycle is 1.92. The Software industry median Cash Conversion Cycle is 32.19. International Business Machines' value of 1.92 is 94% below this industry median. Overall, International Business Machines has a GF Score™ of 80/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does International Business Machines' Cash Conversion Cycle compare to ACN and FISV?
International Business Machines' Cash Conversion Cycle of 1.92 can be compared against companies in the Software industry. The industry median Cash Conversion Cycle is 32.19. International Business Machines' value of 1.92 is 94% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Cash Conversion Cycle for a Software company?
The median Cash Conversion Cycle among Software companies is 32.19, based on 2,799 companies in the industry. Companies in the top quartile (top 25%) have a Cash Conversion Cycle significantly above this median, while those in the bottom quartile fall well below. However, Cash Conversion Cycle should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. International Business Machines's current Cash Conversion Cycle of 1.92 is 94% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Cash Conversion Cycle mean?
A high Cash Conversion Cycle can signal that a stock is expensive relative to its fundamentals. Cash conversion cycle equals sum of days inventory and days sales outstanding less days payable. View historical data on International Business Machines and its competitors. For the Software industry, the median Cash Conversion Cycle is 32.19 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. International Business Machines's current Cash Conversion Cycle is 1.92. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is International Business Machines stock overvalued right now?
Based on GuruFocus' analysis, International Business Machines (CHIX:IBMD) is currently considered Fairly Valued. The stock's GF Value™ is €241.06, compared to a current price of €243.60 — trading 1.1% above its estimated fair value. The current Cash Conversion Cycle is 1.92 and 94% below the Software industry median of 32.19. International Business Machines' overall GF Score™ is 80/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Cash Conversion Cycle calculated?
Cash Conversion Cycle is calculated from a company's financial statements. For International Business Machines (CHIX:IBMD), the current Cash Conversion Cycle is 1.92 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is International Business Machines (CHIX:IBMD) Overvalued in 2026?
Based on GuruFocus' analysis, International Business Machines stock appears to be overvalued.
The current stock price of €243.60 is trading 1.1% above its estimated GF Value™ of €241.06.
GuruFocus considers International Business Machines to be Fairly Valued.
Key valuation signals for CHIX:IBMD:
Cash Conversion Cycle: 1.92
GF Value™: €241.06 vs. price of €243.60 (1.1% above fair value)
No single metric tells the full story. See the CHIX:IBMD stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
International Business Machines Business Description
Incorporated in 1911, International Business Machines, or IBM, is one of the oldest technology companies in the world. It provides software, IT consulting services, and hardware to help business customers modernize their technology workflows. IBM operates in 175 countries and employs approximately 300,000 people. The company has a robust roster of business partners to service its clients, which includes 95% of all Fortune 500 companies. IBM's products, including Red Hat, watsonx, and mainframes, handle some of the world's most important data workloads in areas like finance and retail.
80GF Score
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