Stock Analysis on Net
Stock Analysis on Net

International Business Machines Corp. (NYSE:IBM)

Adjusted Financial Ratios

Microsoft Excel

Adjusted Financial Ratios (Summary)

International Business Machines Corp., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Activity Ratio
Total Asset Turnover
Reported 0.46 0.48 0.43 0.47 0.51
Adjusted 0.49 0.49 0.46 0.51 0.53
Liquidity Ratio
Current Ratio
Reported 0.96 0.92 0.88 0.98 1.02
Adjusted 1.62 1.53 1.43 1.48 1.53
Solvency Ratios
Debt to Equity
Reported 2.51 2.32 2.74 2.99 3.02
Adjusted 1.73 1.58 1.70 1.90 1.80
Debt to Capital
Reported 0.72 0.70 0.73 0.75 0.75
Adjusted 0.63 0.61 0.63 0.66 0.64
Financial Leverage
Reported 6.00 5.80 6.98 7.57 7.30
Adjusted 3.72 3.54 3.86 4.21 3.89
Profitability Ratios
Net Profit Margin
Reported 12.13% 2.71% 10.01% 7.59% 12.22%
Adjusted 9.06% 8.11% 13.95% 3.58% 13.01%
Return on Equity (ROE)
Reported 33.29% 7.47% 30.38% 27.14% 45.25%
Adjusted 16.55% 14.19% 24.88% 7.67% 26.96%
Return on Assets (ROA)
Reported 5.55% 1.29% 4.35% 3.58% 6.20%
Adjusted 4.45% 4.01% 6.45% 1.82% 6.92%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. International Business Machines Corp. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. International Business Machines Corp. adjusted current ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. International Business Machines Corp. adjusted debt-to-equity ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. International Business Machines Corp. adjusted debt-to-capital ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 International Business Machines Corp. adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. International Business Machines Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. International Business Machines Corp. adjusted ROE deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. International Business Machines Corp. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

International Business Machines Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Revenue 61,860 60,530 57,350 73,620 77,147
Total assets 135,241 127,243 132,001 155,971 152,186
Activity Ratio
Total asset turnover1 0.46 0.48 0.43 0.47 0.51
Adjusted
Selected Financial Data (US$ in millions)
Adjusted revenue2 63,313 59,966 57,707 74,877 78,414
Adjusted total assets3 128,886 121,309 124,873 147,109 147,336
Activity Ratio
Adjusted total asset turnover4 0.49 0.49 0.46 0.51 0.53

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Total asset turnover = Revenue ÷ Total assets
= 61,860 ÷ 135,241 = 0.46

2 Adjusted revenue. See details »

3 Adjusted total assets. See details »

4 2023 Calculation
Adjusted total asset turnover = Adjusted revenue ÷ Adjusted total assets
= 63,313 ÷ 128,886 = 0.49

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. International Business Machines Corp. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Current Ratio

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Current assets 32,908 29,118 29,539 39,165 38,420
Current liabilities 34,122 31,505 33,619 39,869 37,701
Liquidity Ratio
Current ratio1 0.96 0.92 0.88 0.98 1.02
Adjusted
Selected Financial Data (US$ in millions)
Adjusted current assets2 33,209 29,440 29,781 39,544 38,752
Adjusted current liabilities3 20,496 19,257 20,861 26,749 25,335
Liquidity Ratio
Adjusted current ratio4 1.62 1.53 1.43 1.48 1.53

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= 32,908 ÷ 34,122 = 0.96

2 Adjusted current assets. See details »

3 Adjusted current liabilities. See details »

4 2023 Calculation
Adjusted current ratio = Adjusted current assets ÷ Adjusted current liabilities
= 33,209 ÷ 20,496 = 1.62

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. International Business Machines Corp. adjusted current ratio improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Debt to Equity

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total debt 56,547 50,949 51,704 61,538 62,899
Total IBM stockholders’ equity 22,533 21,944 18,901 20,597 20,841
Solvency Ratio
Debt to equity1 2.51 2.32 2.74 2.99 3.02
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 59,935 54,013 55,140 66,469 68,158
Adjusted total equity3 34,637 34,261 32,346 34,979 37,832
Solvency Ratio
Adjusted debt to equity4 1.73 1.58 1.70 1.90 1.80

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Debt to equity = Total debt ÷ Total IBM stockholders’ equity
= 56,547 ÷ 22,533 = 2.51

2 Adjusted total debt. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted debt to equity = Adjusted total debt ÷ Adjusted total equity
= 59,935 ÷ 34,637 = 1.73

Solvency ratio Description The company
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. International Business Machines Corp. adjusted debt-to-equity ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Debt to Capital

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total debt 56,547 50,949 51,704 61,538 62,899
Total capital 79,080 72,893 70,605 82,135 83,740
Solvency Ratio
Debt to capital1 0.72 0.70 0.73 0.75 0.75
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 59,935 54,013 55,140 66,469 68,158
Adjusted total capital3 94,572 88,274 87,486 101,448 105,990
Solvency Ratio
Adjusted debt to capital4 0.63 0.61 0.63 0.66 0.64

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 56,547 ÷ 79,080 = 0.72

2 Adjusted total debt. See details »

3 Adjusted total capital. See details »

4 2023 Calculation
Adjusted debt to capital = Adjusted total debt ÷ Adjusted total capital
= 59,935 ÷ 94,572 = 0.63

Solvency ratio Description The company
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. International Business Machines Corp. adjusted debt-to-capital ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total assets 135,241 127,243 132,001 155,971 152,186
Total IBM stockholders’ equity 22,533 21,944 18,901 20,597 20,841
Solvency Ratio
Financial leverage1 6.00 5.80 6.98 7.57 7.30
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total assets2 128,886 121,309 124,873 147,109 147,336
Adjusted total equity3 34,637 34,261 32,346 34,979 37,832
Solvency Ratio
Adjusted financial leverage4 3.72 3.54 3.86 4.21 3.89

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Financial leverage = Total assets ÷ Total IBM stockholders’ equity
= 135,241 ÷ 22,533 = 6.00

2 Adjusted total assets. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted financial leverage = Adjusted total assets ÷ Adjusted total equity
= 128,886 ÷ 34,637 = 3.72

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 International Business Machines Corp. adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to IBM 7,502 1,639 5,743 5,590 9,431
Revenue 61,860 60,530 57,350 73,620 77,147
Profitability Ratio
Net profit margin1 12.13% 2.71% 10.01% 7.59% 12.22%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 5,734 4,861 8,049 2,683 10,200
Adjusted revenue3 63,313 59,966 57,707 74,877 78,414
Profitability Ratio
Adjusted net profit margin4 9.06% 8.11% 13.95% 3.58% 13.01%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Net profit margin = 100 × Net income attributable to IBM ÷ Revenue
= 100 × 7,502 ÷ 61,860 = 12.13%

2 Adjusted net income. See details »

3 Adjusted revenue. See details »

4 2023 Calculation
Adjusted net profit margin = 100 × Adjusted net income ÷ Adjusted revenue
= 100 × 5,734 ÷ 63,313 = 9.06%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. International Business Machines Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to IBM 7,502 1,639 5,743 5,590 9,431
Total IBM stockholders’ equity 22,533 21,944 18,901 20,597 20,841
Profitability Ratio
ROE1 33.29% 7.47% 30.38% 27.14% 45.25%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 5,734 4,861 8,049 2,683 10,200
Adjusted total equity3 34,637 34,261 32,346 34,979 37,832
Profitability Ratio
Adjusted ROE4 16.55% 14.19% 24.88% 7.67% 26.96%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROE = 100 × Net income attributable to IBM ÷ Total IBM stockholders’ equity
= 100 × 7,502 ÷ 22,533 = 33.29%

2 Adjusted net income. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted ROE = 100 × Adjusted net income ÷ Adjusted total equity
= 100 × 5,734 ÷ 34,637 = 16.55%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. International Business Machines Corp. adjusted ROE deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to IBM 7,502 1,639 5,743 5,590 9,431
Total assets 135,241 127,243 132,001 155,971 152,186
Profitability Ratio
ROA1 5.55% 1.29% 4.35% 3.58% 6.20%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 5,734 4,861 8,049 2,683 10,200
Adjusted total assets3 128,886 121,309 124,873 147,109 147,336
Profitability Ratio
Adjusted ROA4 4.45% 4.01% 6.45% 1.82% 6.92%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROA = 100 × Net income attributable to IBM ÷ Total assets
= 100 × 7,502 ÷ 135,241 = 5.55%

2 Adjusted net income. See details »

3 Adjusted total assets. See details »

4 2023 Calculation
Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × 5,734 ÷ 128,886 = 4.45%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. International Business Machines Corp. adjusted ROA deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.