In Technical Analysis

IBM – Technically Positive

 

IBM Looks Technically Positive. International Business Machines Corp (NYSE:IBM) has broken through the floor of the rising trend suggesting a weaker initial rising rate. IBM is testing the support at dollar $150, which may give a bullish reaction. Negative volume balance weakens the stock in the short term. The stock is overall considered technically positive for the medium long term. The operating cash flow looks good at 2.3 times the net income.

IBM Looks Technically Positive

IBM Looks Technically Positive

IBM Positive Ratios:

 

  • The price to earnings multiple of 11.2 is attractive when compared with the industry average PE ratio of 26.5.
  • IBM stock is trading at a favourable price to sales multiple of 1.8 as against the Computer-Integrated Systems industry average multiple of 2.7.
  • International Business Machines’ return on invested capital of 14.1% is good.
  • International Business Machines’ has a good Return On Equity (ROE) of 68.3%.
  • The company has a healthy free cash flow margin of 18%.

Adverse factors:

 

  • International Business Machines revenue saw a decline of -2.8% YoY in 2017 Q1.
  • The company saw an average annual sales decline of -5.8% in sales over the last 5 years.
  • With a debt/equity ratio of  2.32, International Business Machines is highly leveraged in comparison to Computer and Technology peers.
Volatility Remains Subdued - market volatility remains subdued whilst positioning in VIX-linked ETF Products suggests significant bets on higher volatility