IBM trades against a final fair-value range of $239.16-$326.13, with the midpoint set by the accepted valuation synthesis rather than earlier draft model outputs. Fair value range: low $239, high $326, with mid-point at $283.
Stock analysis
International Business Machines CorporationIBM International Business Machines Corporation fair value $283–$326
Trades below fair value with a meaningful cushion to the midpoint.
Fair value
$283
Margin of safety
+18.7%
Confidence
88/100
Moat
6.5/10
Educational analysis only — not financial advice. Always do your own due diligence.
$229.76Price
FV $282.5
High $326.13
IBM trades against a final fair-value range of $239.16-$326.13, with the midpoint set by the accepted valuation synthesis rather than earlier draft model outputs.
High switching costs for legacy
High switching costs for legacy enterprise infrastructure
Mission-critical hybrid cloud deployments via
Mission-critical hybrid cloud deployments via Red Hat
A prolonged slowdown in enterprise IT spending heavily impacts the consulting segment, while legacy infrastructure declines offset software gains, pressuring free cash flow and the dividend payout.
Based on our latest analysis, IBM looks meaningfully undervalued. The current price is $230 versus a composite fair-value midpoint of $283 (range $239–$326), which implies roughly 22.9% upside to the midpoint.
Our composite fair-value range for IBM is $239–$326, with a midpoint of $283. The range is triangulated across multiple valuation models (discounted earnings, forward earnings scenarios, peer multiples, and where applicable owner earnings or reverse DCF) and weighted by reliability for International Business Machines Corporation's archetype.
Our current rating for IBM is Buy with a confidence score of 88/100. IBM is rated Buy at $229.76 versus the reconciled fair value midpoint of $282.50, implying +22.95% upside/downside. Confidence is separately disclosed at 88/100. This is research for educational purposes, not personalized investment advice.
The top risks our latest report flags for International Business Machines Corporation are: Hyperscaler Compression; Consulting Collapse; Gen AI Disruption. The single biggest risk is Hyperscaler Compression: Cloud providers aggressively price hybrid solutions, eroding IBM's software operating margin expansion.
Our current rating for IBM is Buy, issued with a confidence score of 88/100 and a moat score of 6.5/10. The rating reflects the composite fair-value range ($239–$326) versus the current price of $230.
International Business Machines Corporation is classified as a mature-dividend stock. Archetype determines how every downstream parameter — discount rate, terminal growth, deceleration curve, terminal multiple, scenario probability weights, scorecard weights, and which valuation models are prioritized — is calibrated for IBM.
