Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. International Business Machines's annualized net income for the quarter that ended in Mar. 2026 was MXN87,711 Mil. International Business Machines's average shareholder tangible equity for the quarter that ended in Mar. 2026 was MXN-926,416 Mil. Therefore, International Business Machines's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was Negative Tangible Equity%.
The historical rank and industry rank for International Business Machines's Return-on-Tangible-Equity or its related term are showing as below:
MEX:IBM'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 0 Med: 0 Max: 0
Current: Negative Tangible Equity
MEX:IBM's Return-on-Tangible-Equity is ranked better than 99.92% of 2470
companies
in the Software industry
Industry Median: 8.77
vs MEX:IBM: Negative Tangible Equity
International Business Machines (MEX:IBM) Return-on-Tangible-Equity Explanation
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
International Business Machines Return-on-Tangible-Equity Related Terms
International Business Machines Return-on-Tangible-Equity 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 Return-on-Tangible-Equity Chart
MEX:IBM vs ACN, FISV, FIS: Return-on-Tangible-Equity Comparison
For the Information Technology Services subindustry, International Business Machines's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity 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 Return-on-Tangible-Equity vs Software Industry
For the Software industry and Technology sector, International Business Machines's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where International Business Machines's Return-on-Tangible-Equity falls into.
* 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.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of Negative Tangible Equity% mean?
International Business Machines (MEX:IBM) has a Return-on-Tangible-Equity of Negative Tangible Equity% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on International Business Machines and its competitors. According to the industry distribution chart, International Business Machines ranks #2 out of 2470 companies in the Software industry, placing it in the top 0.099999999999994%.
Is International Business Machines' Return-on-Tangible-Equity too high?
International Business Machines' current Return-on-Tangible-Equity is Negative Tangible Equity%. Based on the distribution chart, International Business Machines ranks #2 out of 2470 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, International Business Machines has a GF Score™ of 68/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does International Business Machines' Return-on-Tangible-Equity compare to ACN and FISV?
According to the Software industry distribution chart, International Business Machines ranks #2 out of 2470 companies for Return-on-Tangible-Equity. This places International Business Machines in the top 0% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 8.77. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Equity for a Software company?
The median Return-on-Tangible-Equity among Software companies is 8.77, based on 2,470 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on International Business Machines and its competitors. For the Software industry, the median Return-on-Tangible-Equity is 8.77 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. International Business Machines's current Return-on-Tangible-Equity is Negative Tangible Equity%. 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 (MEX:IBM) is currently considered Modestly Overvalued. The stock's GF Value™ is MXN4,159.36, compared to a current price of MXN5,034.99 — trading 21.1% above its estimated fair value. The current Return-on-Tangible-Equity is Negative Tangible Equity%. International Business Machines' overall GF Score™ is 68/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For International Business Machines (MEX:IBM), the current Return-on-Tangible-Equity is Negative Tangible Equity% 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 (MEX:IBM) Overvalued in 2026?
Based on GuruFocus' analysis, International Business Machines stock appears to be overvalued.
The current stock price of MXN5,034.99 is trading 21.1% above its estimated GF Value™ of MXN4,159.36.
GuruFocus considers International Business Machines to be Modestly Overvalued.
No single metric tells the full story. See the MEX:IBM 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.
68GF Score
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