Stock Analysis on Net

International Business Machines Corp. (NYSE:IBM)

Enterprise Value to EBITDA (EV/EBITDA) 

Microsoft Excel LibreOffice Calc

Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)

International Business Machines Corp., EBITDA calculation

US$ in millions

Microsoft Excel LibreOffice Calc
12 months ended: Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Net income attributable to IBM 5,743  5,590  9,431  8,728  5,753 
Add: Net income attributable to noncontrolling interest 19  22  25  17  17 
Less: Income (loss) from discontinued operations, net of tax 1,031  89  (4) (5)
Add: Income tax expense 125  (864) 731  2,619  5,642 
Earnings before tax (EBT) 4,856  4,659  10,191  11,359  11,417 
Add: Interest expense 1,155  1,288  1,344  723  615 
Earnings before interest and tax (EBIT) 6,011  5,947  11,535  12,082  12,032 
Add: Depreciation 3,888  4,227  4,209  3,127  3,021 
Add: Amortization of intangibles 2,529  2,468  1,850  1,353  1,520 
Earnings before interest, tax, depreciation and amortization (EBITDA) 12,428  12,642  17,594  16,562  16,573 

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Item Description The company
EBITDA To calculate EBITDA analysts start with net earnings. To that earnings number, interest, taxes, depreciation, and amortization are added. EBITDA as a pre-interest number is a flow to all providers of capital. International Business Machines Corp. EBITDA decreased from 2019 to 2020 and from 2020 to 2021.

Enterprise Value to EBITDA Ratio, Current

International Business Machines Corp., current EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Selected Financial Data (US$ in millions)
Enterprise value (EV) 163,813 
Earnings before interest, tax, depreciation and amortization (EBITDA) 12,428 
Valuation Ratio
EV/EBITDA 13.18
Benchmarks
EV/EBITDA, Competitors1
Accenture PLC 17.12
Adobe Inc. 28.21
Automatic Data Processing Inc. 13.39
Fidelity National Information Services Inc. 14.61
Intuit Inc. 33.27
Mastercard Inc. 28.81
Microsoft Corp. 22.74
Oracle Corp. 11.87
PayPal Holdings Inc. 9.43
salesforce.com inc. 30.93
ServiceNow Inc. 107.77
Visa Inc. 24.11
EV/EBITDA, Sector
Software & Services 21.21
EV/EBITDA, Industry
Information Technology 18.75

Based on: 10-K (reporting date: 2021-12-31).

1 Click competitor name to see calculations.

If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.


Enterprise Value to EBITDA Ratio, Historical

International Business Machines Corp., historical EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Selected Financial Data (US$ in millions)
Enterprise value (EV)1 155,684  155,259  179,930  158,056  178,322 
Earnings before interest, tax, depreciation and amortization (EBITDA)2 12,428  12,642  17,594  16,562  16,573 
Valuation Ratio
EV/EBITDA3 12.53 12.28 10.23 9.54 10.76
Benchmarks
EV/EBITDA, Competitors4
Accenture PLC 21.47 15.93 15.60 13.79 15.98
Adobe Inc. 35.44 43.06 41.16 37.27 36.77
Automatic Data Processing Inc. 14.05 8.32 12.32 11.88 7.32
Fidelity National Information Services Inc. 14.04 22.62 34.66 14.84 14.27
Intuit Inc. 51.96 35.70 34.27 31.25 21.97
Mastercard Inc. 31.84 38.83 32.61 28.36 24.94
Microsoft Corp. 24.59 21.74 17.21 15.67 15.00
Oracle Corp. 13.78 11.54 11.83 9.50 12.73
PayPal Holdings Inc. 19.34 43.02 27.91 24.59 22.50
salesforce.com inc. 33.82 49.43 55.96 84.53 75.36
ServiceNow Inc. 147.45 220.91 187.17 260.48 1,506.85
Visa Inc. 24.81 29.80 24.56 22.59 20.10
EV/EBITDA, Sector
Software & Services 23.93 23.94 20.01 17.24 16.65
EV/EBITDA, Industry
Information Technology 20.48 20.67 15.74 13.30 13.34

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

1 See details »

2 See details »

3 2021 Calculation
EV/EBITDA = EV ÷ EBITDA
= 155,684 ÷ 12,428 = 12.53

4 Click competitor name to see calculations.

Valuation ratio Description The company
EV/EBITDA Enterprise value to earnings before interest, tax, depreciation and amortization is a valuation indicator for the overall company rather than common stock. International Business Machines Corp. EV/EBITDA ratio increased from 2019 to 2020 and from 2020 to 2021.