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AMAT vs IBM

AMAT
Applied Materials, Inc.
NEUTRAL
Price
$341.79
Market Cap
$271.25B
Sector
Technology
AI Confidence
80%
IBM
International Business Machines Corporation
NEUTRAL
Price
$305.69
Market Cap
$285.74B
Sector
Technology
AI Confidence
75%

Valuation

P/E Ratio
AMAT
35.02
IBM
36.48
Forward P/E
AMAT
24.69
IBM
28.81
P/B Ratio
AMAT
12.49
IBM
10.24
P/S Ratio
AMAT
9.61
IBM
4.37
EV/EBITDA
AMAT
30.37
IBM
19.0

Profitability

Gross Margin
AMAT
48.72%
IBM
57.81%
Operating Margin
AMAT
29.89%
IBM
17.17%
Profit Margin
AMAT
27.78%
IBM
12.09%
ROE
AMAT
38.86%
IBM
30.16%
ROA
AMAT
14.85%
IBM
6.35%

Growth

Revenue Growth
AMAT
-2.1%
IBM
9.1%
Earnings Growth
AMAT
75.2%
IBM
--

Financial Health

Debt/Equity
AMAT
0.33
IBM
2.38
Current Ratio
AMAT
2.71
IBM
0.93
Quick Ratio
AMAT
1.74
IBM
0.78

Dividends

Dividend Yield
AMAT
0.66%
IBM
2.2%
Payout Ratio
AMAT
18.26%
IBM
79.86%

AI Verdict

AMAT NEUTRAL

AMAT shows neutral fundamentals based on deterministic rules. Financial strength is strong (F-Score 9/9). Mixed signals with both opportunities and risks present.

Strengths
Strong profitability (27.8% margin)
Strong financial trend (Piotroski F-Score: 9/9)
Low debt with D/E ratio of 0.33
Risks
High valuation with P/E of 35.0
Premium vs Graham Number ($77.52)
Declining revenue (-2.1%)
IBM NEUTRAL

IBM trades at a premium valuation with solid historical profitability and consistent earnings beats, supported by strong ROE of 30.16% and a 9.1% YoY revenue growth. However, elevated P/E of 36.48 and forward P/E of 28.81 exceed both peer averages and historical norms, while weakening near-term EPS momentum—evidenced by a -5.4% Q/Q decline—raises concerns about sustainability. The stock has delivered strong price performance over 5Y (+232.3%) and 1Y (+50.0%), reflecting investor confidence in its hybrid cloud and AI转型, though leverage remains high at 2.38x Debt/Equity. Analysts broadly concur with a 'hold' recommendation, and absent insider activity, the setup appears balanced between proven execution and stretched near-term expectations.

Strengths
ROE of 30.16% significantly exceeds sector average of 27.63%, indicating superior capital efficiency
9.1% YoY revenue growth outpaces legacy peer expectations and reflects successful strategic repositioning
Consistent earnings beat streak: 3 out of last 4 quarters, with 8.63% average surprise over latest four
Risks
Elevated P/E of 36.48 vs sector avg 175.24 (distorted) but notably above peers like CSCO (30.12) and MU (32.56)
Debt/Equity ratio of 2.38 is more than triple the sector average of 0.74, raising refinancing and flexibility concerns
Q/Q EPS declined -5.4%, signaling potential softness in near-term profitability despite strong YoY growth

Compare Another Pair

AMAT vs IBM: Head-to-Head Comparison

This page compares Applied Materials, Inc. (AMAT) and International Business Machines Corporation (IBM) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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