Broadcom vs IBM Which Is More Reliable?

Broadcom and IBM are two major technology companies with shares traded on the stock market. Broadcom is known for its semiconductor technology, while IBM is a multinational technology corporation offering hardware, software, and consulting services. The performance of these stocks can be influenced by factors such as industry trends, company financials, and market conditions. Investors interested in the technology sector may consider comparing and analyzing the potential risks and returns associated with investing in Broadcom and IBM stocks.

Broadcom or IBM?

When comparing Broadcom and IBM, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Broadcom and IBM.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Broadcom has a dividend yield of 0.94%, while IBM has a dividend yield of 2.89%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Broadcom reports a 5-year dividend growth of 10.81% year and a payout ratio of 166.48%. On the other hand, IBM reports a 5-year dividend growth of 1.32% year and a payout ratio of 95.65%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Broadcom P/E ratio at 178.43 and IBM's P/E ratio at 33.21. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Broadcom P/B ratio is 15.54 while IBM's P/B ratio is 8.69.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Broadcom has seen a 5-year revenue growth of 0.73%, while IBM's is -0.22%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Broadcom's ROE at 8.62% and IBM's ROE at 27.14%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $211.11 for Broadcom and $230.26 for IBM. Over the past year, Broadcom's prices ranged from $104.15 to $228.70, with a yearly change of 119.59%. IBM's prices fluctuated between $157.89 and $239.35, with a yearly change of 51.59%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.