IBM (NYSE)
Sector: Information Technology
Beta Coefficient: 0.63
10 Yr Compound EPS Growth: 13.0%
10 Yr Compound DPS Growth: 19.5%
Dividend raises, past 10 years: 10 times.
Financial Result Year 2014
Revenues (b) 92.8
Net Income (b) 15.7
EPS 15.59
DPS 4.25
Cash flow per share 20.44
Current yield 2.7%
High Price 199.2 P/E 12.8 DY 2.1%
Low Price 150.5 P/E 9.7 DY 2.8%
IBM historically has made a broad range of computers, mainframes, and network servers.
But the company has morphed over the years into a software and services company.
As a consequence, fewer folks than ever talk about an "IBM computer" anymore; they talk about an "IBM business solution" or some such.
IBM is divided into four principal business units and a financing unit:
- The Global Technology Services unit: This is the largest, at 38% of revenues.
- The Global Business Services unit (18%)
- The Software unit (32%).
- The Systems and Technology group (10%)
- The Financing Unit (2%) helps the company market it all.
Overseas sales make up about 55% of revenues.
The company has kept "strategic" large systems but little else; it is now offering cloud-based and integrated hardware/software/service solutions for diverse needs such as business analytics and data security.
It recently invested $4 billion in "new" core strategic areas in cloud and mobile computing, analytics and information security.
It is buying up its own stock, almost 6% of its float last year.
Its business mix is shifting from less profitable hardware to more profitable services, first came consulting, then outsourcing and now, leading-edge analytics, security and cloud services.