International Business Machines Corp. (IBM) Is Worth the Money

Valuations and metrics

International Business Machines Corp. (NYSE:IBM) is not an expensive stock at the moment, currently trading at 13.44 times trailing earnings and 2.09 times sales. The forward Price/Earnings (P/E) is only 10.65. The operating margin of around 21% is ahead of the competition, and the return on equity is outstanding at nearly 83%. While the company has a fairly large amount of debt on the books, the operating cash flow $19.32 billion is impressive.

The bottom line

IBM is perhaps not the most exciting of stocks, nor the fastest growing, but it is a very large and strong company that is still doing a good job of growing earnings in a tough macro-economic environment. A global leader in its industry, International Business Machines Corp. (NYSE:IBM) should continue to perform well throughout the rest of the year, despite a disappointing first quarter. Furthermore, its reasonable valuation could easily account for some upside in the months to come.

The article IBM Is Worth the Money originally appeared on Fool.com and is written by Daniel James.

Daniel James has no position in any stocks mentioned. The Motley Fool owns shares of International Business Machines (NYSE:IBM). Daniel is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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