International Business MachinesXBUL:IBM 76 ROE % is 14.92% as of Mar. 2026, which is 55% below its 10-year median of 32.92. GuruFocus rates XBUL:IBM with a GF Score™ of 76/100 and a GF Value™ of €191.71 (Modestly Overvalued). The stock has 3 warning signs investors should review. Among 2,679 Software companies, International Business Machines ranks better than 92.35% on this metric.
XBUL:IBM'
s ROE % Range Over the Past 10 Years
Min: 8.03 Med: 32.92 Max: 73.04
Current: 36.35
During the past 13 years, International Business Machines's highest ROE % was 73.04%. The lowest was 8.03%. And the median was 32.92%.
XBUL:IBM's ROE % is ranked better than 92.35% of 2679
companies
in the Software industry
Industry Median: 4.69
vs XBUL:IBM: 36.35
International Business Machines (XBUL:IBM) ROE % Explanation
ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.
The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:
Note:
The net income data used here is four times the quarterly (Mar. 2026) net income data. The Revenue data used here is four times the quarterly (Mar. 2026) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.
* 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.
Be Aware
Net Income is used.
Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % 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 ROE %s can be extremely high.
International Business Machines ROE % Related Terms
International Business Machines ROE % 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.
For the Information Technology Services subindustry, International Business Machines's ROE %, along with its competitors' market caps and ROE % 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 ROE % vs Software Industry
For the Software industry and Technology sector, International Business Machines's ROE % distribution charts can be found below:
* The bar in red indicates where International Business Machines's ROE % 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 ROE %, the net income of the last fiscal year and the average total shareholder 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.
ROE % is displayed in the 30-year financial page.
International Business Machines (XBUL:IBM) has a ROE % of 14.92% as of Mar. 2026. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on International Business Machines and its competitors. This is 55% below median its historical median of 32.92. Over the past decade, International Business Machines' ROE % has ranged from 8.03 to 73.04. According to the industry distribution chart, International Business Machines ranks #205 out of 2679 companies in the Software industry, placing it in the top 7.7%.
Is International Business Machines' ROE % too high?
International Business Machines' current ROE % of 14.92% is 55% below median its 10-year median of 32.92. Over the past 10 years, this metric has ranged from a low of 8.03 to a high of 73.04. The Software industry median ROE % is 4.69. International Business Machines' value of 14.92% is 218.1% above this industry median. Based on the distribution chart, International Business Machines ranks #205 out of 2679 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 76/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does International Business Machines' ROE % compare to ACN and FISV?
According to the Software industry distribution chart, International Business Machines ranks #205 out of 2679 companies for ROE %. This places International Business Machines in the top 8% of its industry — outperforming the majority of peers. The industry median ROE % is 4.69. International Business Machines' value of 14.92% is 218.1% above this benchmark. Historically, International Business Machines' own ROE % has ranged from 8.03 to 73.04 over the past decade. While the company's 10-year median is 32.92 vs. the industry median of 4.69, International Business Machines has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROE % for a Software company?
The median ROE % among Software companies is 4.69, based on 2,679 companies in the industry. Companies in the top quartile (top 25%) have a ROE % significantly above this median, while those in the bottom quartile fall well below. However, ROE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. International Business Machines's current ROE % of 14.92% is 218.1% above 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 ROE % mean?
A high ROE % can signal that a stock is expensive relative to its fundamentals. Return on equity is the ratio of current-period net income to average two-period total equity. View historical data on International Business Machines and its competitors. For the Software industry, the median ROE % is 4.69 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. International Business Machines's current ROE % is 14.92%, which is 55% below median its own 10-year median of 32.92. 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 (XBUL:IBM) is currently considered Modestly Overvalued. The stock's GF Value™ is €191.71, compared to a current price of €232.10 — trading 21.1% above its estimated fair value. The current ROE % is 14.92%, which is 55% below median its 10-year median of 32.92 and 218.1% above the Software industry median of 4.69. International Business Machines' overall GF Score™ is 76/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROE % calculated?
ROE % is calculated from a company's financial statements. For International Business Machines (XBUL:IBM), the current ROE % is 14.92% 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 (XBUL:IBM) Overvalued in 2026?
Based on GuruFocus' analysis, International Business Machines stock appears to be overvalued.
The current stock price of €232.10 is trading 21.1% above its estimated GF Value™ of €191.71.
GuruFocus considers International Business Machines to be Modestly Overvalued.
Key valuation signals for XBUL:IBM:
ROE %: 14.92% (55% below median its 10-year median of 32.92)
GF Value™: €191.71 vs. price of €232.10 (21.1% above fair value)
Industry Position: 218.1% above the Software median (#205 of 2679)
No single metric tells the full story. See the XBUL: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.
76GF Score
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