Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, global IT solutions giant International Business Machines (NYSE: IBM ) has earned a respected four-star ranking.
With that in mind, let's take a closer look at IBM's business and see what CAPS investors are saying about the stock right now.
|Headquarters (founded)||Armonk, N.Y. (1910)|
|Market Cap||$239.8 billion|
|Industry||IT consulting and other services|
|Trailing-12-Month Revenue||$106.1 billion|
|Management||CEO Virginia Rometty (since January 2012)
CFO Mark Loughridge (since July 2010)
|Return on Capital (average, past 3 years)||26%|
|Cash/Debt||$11.2 billion / $32.4 billion|
Sources: S&P Capital IQ and Motley Fool CAPS.
On CAPS, 91% of the 4,633 members who have rated IBM believe the stock will outperform the S&P 500 going forward.
IBM is a wonderful, consistent company at a fair price. My only concern is the [long-term] durability of IBM's moat due to being a tech company. Looks great for the medium term at least.
5 yr avg ROIC 18.7%, 5 yr avg ROE 59% ... [free cash flow]/sales% 15% (cash king). ... Reasonable debt level. [Dividend yield] around 1.6%
14x FCF, 14x P/E ...
I'm conservatively forecasting 12%-15% compounded returns, including reinvested dividends for the next 2-5 years. I got a feeling the S&P ain't gonna keep up with that.
If you want market-thumping returns, you need to put together the best portfolio you can. Of course, despite a strong four-star rating, IBM may not be your top choice.
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