Teradata vs IBM Which Should You Buy?

Teradata and IBM are two well-known companies in the technology sector, each offering unique strengths and opportunities for investors. Teradata specializes in data analytics and management, providing solutions for companies looking to harness the power of big data. IBM, on the other hand, is a diversified technology company with offerings in cloud computing, artificial intelligence, and cybersecurity. Both companies have a strong market presence and historical performance that attract investors seeking growth and stability in the technology industry.

Teradata or IBM?

When comparing Teradata 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 Teradata 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. Teradata has a dividend yield of -%, while IBM has a dividend yield of 2.89%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Teradata reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. 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 Teradata P/E ratio at 37.85 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. Teradata P/B ratio is 24.83 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, Teradata has seen a 5-year revenue growth of 0.01%, while IBM's is -0.22%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Teradata's ROE at 84.54% and IBM's ROE at 27.14%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $32.08 for Teradata and $230.26 for IBM. Over the past year, Teradata's prices ranged from $24.02 to $49.44, with a yearly change of 105.83%. 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.