IBM vs Tech Mahindra Which Is More Lucrative?

IBM and Tech Mahindra are two major players in the technology sector, each offering a unique set of products and services to their customers. IBM, a global technology giant with a strong presence in the market for decades, has a proven track record of innovation and customer satisfaction. On the other hand, Tech Mahindra, a rapidly growing IT services company based in India, has been gaining traction in the industry with its focus on digital transformation and cutting-edge solutions. Investors looking to capitalize on the technology sector may find both IBM and Tech Mahindra stocks to be attractive options, but a thorough analysis of each company's financial performance, growth potential, and market trends is essential to make an informed investment decision.

IBM or Tech Mahindra?

When comparing IBM and Tech Mahindra, 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 IBM and Tech Mahindra.

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. IBM has a dividend yield of 2.8%, while Tech Mahindra has a dividend yield of 2.41%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. IBM reports a 5-year dividend growth of 1.32% year and a payout ratio of 95.65%. On the other hand, Tech Mahindra reports a 5-year dividend growth of 25.74% year and a payout ratio of 0.00%.

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 IBM P/E ratio at 34.25 and Tech Mahindra's P/E ratio at 48.22. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. IBM P/B ratio is 8.96 while Tech Mahindra's P/B ratio is 5.97.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, IBM has seen a 5-year revenue growth of -0.22%, while Tech Mahindra's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with IBM's ROE at 27.14% and Tech Mahindra's ROE at 12.22%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $234.22 for IBM and ₹1775.60 for Tech Mahindra. Over the past year, IBM's prices ranged from $157.89 to $238.38, with a yearly change of 50.98%. Tech Mahindra's prices fluctuated between ₹1162.95 and ₹1797.00, with a yearly change of 54.52%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.