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IBM (International Business Machines) Piotroski F-Score : 6 (As of Mar. 20, 2025)


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What is International Business Machines Piotroski F-Score?

The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

International Business Machines has an F-score of 6 indicating the company's financial situation is typical for a stable company.

The historical rank and industry rank for International Business Machines's Piotroski F-Score or its related term are showing as below:

IBM' s Piotroski F-Score Range Over the Past 10 Years
Min: 5   Med: 6   Max: 8
Current: 6

During the past 13 years, the highest Piotroski F-Score of International Business Machines was 8. The lowest was 5. And the median was 6.


International Business Machines Piotroski F-Score Historical Data

The historical data trend for International Business Machines's Piotroski F-Score 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.

* Premium members only.

International Business Machines Piotroski F-Score Chart

International Business Machines Annual Data
Trend Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23 Dec24
Piotroski F-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 5.00 6.00 5.00 8.00 6.00

International Business Machines Quarterly Data
Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24 Dec24
Piotroski F-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.00 7.00 6.00 6.00 6.00

Competitive Comparison of International Business Machines's Piotroski F-Score

For the Information Technology Services subindustry, International Business Machines's Piotroski F-Score, along with its competitors' market caps and Piotroski F-Score 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's Piotroski F-Score Distribution in the Software Industry

For the Software industry and Technology sector, International Business Machines's Piotroski F-Score distribution charts can be found below:

* The bar in red indicates where International Business Machines's Piotroski F-Score falls into.


How is the Piotroski F-Score calculated?

* 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.

This Year (Dec24) TTM:Last Year (Dec23) TTM:
Net Income was 1605 + 1834 + -330 + 2914 = $6,023 Mil.
Cash Flow from Operations was 4168 + 2066 + 2881 + 4330 = $13,445 Mil.
Revenue was 14461 + 15769 + 14967 + 17553 = $62,750 Mil.
Gross Profit was 7742 + 8950 + 8420 + 10439 = $35,551 Mil.
Average Total Assets from the begining of this year (Dec23)
to the end of this year (Dec24) was
(135241 + 137169 + 133848 + 134339 + 137175) / 5 = $135554.4 Mil.
Total Assets at the begining of this year (Dec23) was $135,241 Mil.
Long-Term Debt & Capital Lease Obligation was $52,539 Mil.
Total Current Assets was $34,482 Mil.
Total Current Liabilities was $33,142 Mil.
Net Income was 927 + 1583 + 1704 + 3288 = $7,502 Mil.

Revenue was 14252 + 15475 + 14752 + 17380 = $61,859 Mil.
Gross Profit was 7509 + 8501 + 8023 + 10267 = $34,300 Mil.
Average Total Assets from the begining of last year (Dec22)
to the end of last year (Dec23) was
(127243 + 133637 + 132213 + 129321 + 135241) / 5 = $131531 Mil.
Total Assets at the begining of last year (Dec22) was $127,243 Mil.
Long-Term Debt & Capital Lease Obligation was $52,689 Mil.
Total Current Assets was $32,908 Mil.
Total Current Liabilities was $34,122 Mil.

*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.

Profitability

Question 1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

International Business Machines's current Net Income (TTM) was 6,023. ==> Positive ==> Score 1.

Question 2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

International Business Machines's current Cash Flow from Operations (TTM) was 13,445. ==> Positive ==> Score 1.

Question 3. Change in Return on Assets

Compare this year's return on assets (1) to last year's return on assets.

Score 1 if it's higher, 0 if it's lower.

ROA (This Year)=Net Income/Total Assets (Dec23)
=6023/135241
=0.04453531

ROA (Last Year)=Net Income/Total Assets (Dec22)
=7502/127243
=0.05895806

International Business Machines's return on assets of this year was 0.04453531. International Business Machines's return on assets of last year was 0.05895806. ==> Last year is higher ==> Score 0.

Question 4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA <= ROA.

International Business Machines's current Net Income (TTM) was 6,023. International Business Machines's current Cash Flow from Operations (TTM) was 13,445. ==> 13,445 > 6,023 ==> CFROA > ROA ==> Score 1.

Funding

Question 5. Change in Gearing or Leverage

Compare this year's gearing (long-term debt divided by average total assets) to last year's gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Dec24)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec23 to Dec24
=52539/135554.4
=0.38758609

Gearing (Last Year: Dec23)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec22 to Dec23
=52689/131531
=0.40058237

International Business Machines's gearing of this year was 0.38758609. International Business Machines's gearing of last year was 0.40058237. ==> This year is lower or equal to last year. ==> Score 1.

Question 6. Change in Working Capital (Liquidity)

Compare this year's current ratio (current assets divided by current liabilities) to last year's current ratio.

Score 1 if this year's current ratio is higher, 0 if it's lower

Current Ratio (This Year: Dec24)=Total Current Assets/Total Current Liabilities
=34482/33142
=1.04043208

Current Ratio (Last Year: Dec23)=Total Current Assets/Total Current Liabilities
=32908/34122
=0.96442178

International Business Machines's current ratio of this year was 1.04043208. International Business Machines's current ratio of last year was 0.96442178. ==> This year's current ratio is higher. ==> Score 1.

Question 7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

International Business Machines's number of shares in issue this year was 942.445. International Business Machines's number of shares in issue last year was 927.395. ==> There is larger number of shares in issue this year. ==> Score 0.

Efficiency

Question 8. Change in Gross Margin

Compare this year's gross margin (Gross Profit divided by sales) to last year's.

Score 1 if this year's gross margin is higher, 0 if it's lower.

Gross Margin (This Year: TTM)=Gross Profit/Revenue
=35551/62750
=0.5665498

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=34300/61859
=0.55448682

International Business Machines's gross margin of this year was 0.5665498. International Business Machines's gross margin of last year was 0.55448682. ==> This year's gross margin is higher. ==> Score 1.

Question 9. Change in asset turnover

Compare this year's asset turnover (total sales for the year divided by total assets at the beginning of the year) to last year's asset turnover ratio.

Score 1 if this year's asset turnover ratio is higher, 0 if it's lower

Asset Turnover (This Year)=Revenue/Total Assets at the Beginning of This Year (Dec23)
=62750/135241
=0.46398651

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Dec22)
=61859/127243
=0.48614855

International Business Machines's asset turnover of this year was 0.46398651. International Business Machines's asset turnover of last year was 0.48614855. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+0+1+1+1+0+1+0
=6

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

International Business Machines has an F-score of 6 indicating the company's financial situation is typical for a stable company.

International Business Machines  (NYSE:IBM) Piotroski F-Score Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


International Business Machines Piotroski F-Score Related Terms

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International Business Machines Business Description

Address
One New Orchard Road, Armonk, NY, USA, 10504
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 300,000 people. The company has a robust roster of business partners to service its clients, which include 95% of all Fortune 500 companies. Primary products include its mainframes, Red Hat software, transaction processing software, and IT consulting.
Executives
Alfred W Zollar director C/O LOTUS SOFTWARE, ONE ROGER STREET, CAMBRIDGE MA 02142
Nickle Jaclyn Lamoreaux officer: Senior Vice President IBM CORPORATION, ONE NEW ORCHARD RD, ARMONK NY 10504-1722
Michelle H Browdy officer: Senior Vice President IBM CORPORATION, ONE NEW ORCHARD ROAD, ARMONK NY 10504-1722
Michael Miebach director 2000 PURCHASE STREET, PURCHASE NY 10577
James J Kavanaugh officer: Vice President and Controller IBM CORPORATION, ONE NEW ORCHARD RD, ARMONK NY 10504-1722
Nicolas A. Fehring officer: VP, Controller ONE NEW ORCHARD ROAD, ARMONK NY 10504
Del Bene Robert F officer: VP, Controller IBM CORPORATION, ONE NEW ORCHARD RD, ARMONK NY 10504-1722
David N Farr director
Michelle J Howard director C/O SECRETARY'S OFFICE, IBM CORPORATION, ARMONK NY 10504
Gary D Cohn officer: Vice Chairman 812 PARK AVENUE, 7-8A, NEW YORK NY 10021
James M Whitehurst officer: President IBM CORPORATION, ONE NEW ORCHARD RD, ARMONK NY 10504-1722
Alex Gorsky director JOHNSON & JOHNSON, ONE JOHNSON & JOHNSON PLAZA, NEW BRUNSWICK NJ 08933
Andrew N Liveris director 2211 H.H. DOW WAY, MIDLAND MI 48674
Joseph Swedish director WELLPOINT, INC., 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204
Frederick H Waddell director 50 S. LA SALLE ST., CHICAGO IL 60675