Signal Ledger LabSignal Ledger valuation · IBM
International Business Machines Corp
What the shares are worth today on our research (management’s own targets for each business): every line valued at the end of FY2030, net debt rolled forward, then discounted back to Sep 30, 2026.
Signal Ledger valuation$260.36+3% vs $252.11
- Business value at FY2030
- $326B
- FY2030 revenue
- $91B
- FY2030 EPS · P/E
- $17.16 · 19×
- Discount rate (WACC · equity)
- 7.76% · 8.60%
Latest quarter in this research: Q3 2026
Reported Oct 21, 2026 for the quarter to Sep 30, 2026 (company release ↗). This valuation already reflects these results (researched Oct 23, 2026).
Revenue$17.1B
Operating income$2.99B17.5% margin
Net income$2.19B
Diluted EPS$2.30
| Segment | Revenue | vs a year ago | Operating income | Margin |
|---|---|---|---|---|
| Software | $7.80B | +8% | — | — |
| Consulting | $5.33B | +0.2% | — | — |
| Infrastructure | $3.71B | +4% | — | — |
| Financing | $0.19B | −4% | — | — |
| Other | $66M | +74% | — | — |
- Operating income 2.988B is derived under the existing IBM EBIT convention: GAAP continuing pretax 2.497B + interest expense.491B; it includes 109M other income and is not IBM operating(non-GAAP) pretax 3.3B. Rounded segment revenue sums 17.104B versus 17.103B reported total (1M rounding).
- Total net income 2.190B / dilutedEPS2.30 include discontinued operations; continuing income 2.199B / EPS2.31. Do not substitute adjusted operatingEPS2.95.
- FY2026 constant-currency revenue growth 4-5%, neutralFX, is reaffirmed; free cash flow growth upgraded to more than 1B year-over-year.
- September 30 10-Q now supplies complete group and Financing balance data: cash plus marketable securities $11.058B excluding $48M restricted cash, group debt $63.817B including finance leases, Financing debt $12.652B and equity $1.406B; common cover shares 945,120,805. No same-date latestBalance override.
What each business is worth
| Business | Model | FY2030 revenue | Value today | Per share | 2030 multiple | Value from beyond FY2030 |
|---|---|---|---|---|---|---|
| Software | Margin | $48B | $283B | $299.93 | 18.4× EBIT | 68% |
| Consulting | Margin | $24B | $50B | $52.45 | 15.5× EBIT | 65% |
| Infrastructure | Margin | $17B | $60B | $63.68 | 14.5× EBIT | 63% |
| Other | Margin | $0.1B | $0B | $0.00 | — | 0% |
| Financing | Return on equity (residual income) | — | $5.9B | $6.22 | 4.4× P/B | 43% |
| Company costsHead-office costs no segment carries, valued as one negative business | Cost line | — | −$113B | −$119.21 | — | 70% |
| All businesses | $91B | $287B | $303.51 |
From 2030 back to today
- Enterprise value at end of FY2030$326B
- Less net debt at FY2030$15B
- Equity value at FY2030$312B
- ÷ (1 + 8.60%)^4.3 years at the cost of equity$219B
- + dividends paid on the way, discounted$23B
This reconciliation checks the published Signal Ledger valuation against the net-debt path. The difference is 1.5%, inside our 5% tolerance.
From businesses to one share
- All businesses, valued today$287B
- − borrowings$50B
- − finance leases$1.2B
- − preferred and minority claims$0.7B
- + cash and short-term investments$11B
- ÷ diluted shares0.945B
- Signal Ledger valuation$260.36
The financing arm is valued on its own equity, so the borrowings that fund its loans and leases sit inside that value; only the operating businesses' borrowings are deducted here.
Year by year to FY2030
| Fiscal year | Revenue | EBITDA | Capex | Free cash flow | Net debt at year end |
|---|---|---|---|---|---|
| FY2026 | $71B | $14B | $1.7B | $10B | $40B |
| FY2027 | $75B | $15B | $1.9B | $12B | $37B |
| FY2028 | $80B | $17B | $2B | $13B | $31B |
| FY2029 | $85B | $20B | $2.1B | $15B | $24B |
| FY2030 | $91B | $22B | $2.3B | $17B | $15B |
What must be true
- Software grows revenue from $32.3B in FY2026 to $48.3B in FY2030 (1.5×).
- Consulting grows revenue from $21.1B in FY2026 to $24.4B in FY2030 (1.2×).
- Infrastructure grows revenue from $16.4B in FY2026 to $17.4B in FY2030 (1.1×).
- Other holds revenue roughly flat, from $63M in FY2026 to $63M in FY2030.
- Financing holds revenue roughly flat, from $0.7B in FY2026 to $0.7B in FY2030.
- Software raises its EBIT margin from 33.1% to 37.1%.
- Consulting raises its EBIT margin from 11.7% to 14.7%.
- Infrastructure raises its EBIT margin from 22.0% to 26.0%.
- Other holds its EBIT margin at 0.0%.
- The company spends $9.9B of capital expenditure through FY2030.
- Net debt peaks at $40.8B in FY2025 and stays financeable.
- Financing keeps earning 32.3% on its equity, against a 8.60% cost of equity.
What the price implies
At our discount rate, the price assumes less than our research overall: one combination matching $252.11 is about $87.4B of FY2030 sales (growth of about 5.8% a year from FY2026) with 28.9% GAAP EBIT margin — versus $90.1B and 28.9% GAAP EBIT margin in our research.
Sales and margins here cover operating lines only; financial lines stay fixed. These sales figures are not total company revenue.
At the research price of $252.11 (2026-10-23), the price asks less than our assumptions overall. These are operating requirements at that price, not additional valuations or forecasts.
If sales and margins changed together
Each row matches the same research price at our unchanged discount rate, by scaling every operating line's margin by one common factor. Sales cover margin and capacity lines only; other valuation lines stay fixed. Margins are revenue-weighted within each metric, before separately modeled corporate costs and eliminations. The conclusion uses the row at our research margins when sales alone can match the price, otherwise the solved row needing the least sales growth; this is a trade-off between growth and profitability, not a forecast.
| FY2030 sales factor | FY2030 sales | FY2026–30 CAGR | Required FY2030 margin | Requirement |
|---|---|---|---|---|
| 0.97×At research margins | $87.4B | 5.8% | 28.9% GAAP EBIT | Within margin guardrails |
| 1.50× | $135.1B | 17.9% | 22.1% GAAP EBIT | Within margin guardrails |
| 2.00× | $180.2B | 26.7% | 18.8% GAAP EBIT | Within margin guardrails |
| 3.00× | $270.2B | 40.2% | 15.5% GAAP EBIT | Within margin guardrails |
CAGR uses $69.9B of same-scope FY2026 sales from the published model or its sourced research base, over four fiscal years. “Within margin guardrails” checks numeric limits only, not commercial plausibility. Each line and year must stay at or below 50.0% GAAP EBIT and 100% EBITDA, or our research margin where that is higher; capacity EBIT uses the engine's equipment depreciation. Unsolved margins are not extrapolated.
- Implied discount rate
- 7.9%
- All-business FY2030 sales factor
- 0.97×
The WACC that makes model value equal the price, shifting WACC and cost of equity by the same amount. Model: 7.8% WACC · 8.6% cost of equity.
FY2030 revenue would need to reach $87.4B (model: $90.1B) across the margin and capacity businesses. FY1 stays fixed; the sales change ramps to FY2030 and stays at that factor thereafter.
If only one business changed
Businesses with margin or capacity revenue paths, ordered by value today. Revenue and margin are separate alternatives; these requirements are not added together.
Software
- Revenue alone
- FY2030 revenue would need to reach $46.5B (model: $48.3B).
- Margin alone
FY2030 EBIT margin would need to reach 36.1% (model: 37.1%).
Infrastructure
- Revenue alone
- FY2030 revenue would need to reach $14B (model: $17.4B).
- Margin alone
FY2030 EBIT margin would need to reach 22.7% (model: 26.0%).
Consulting
- Revenue alone
- FY2030 revenue would need to reach $15B (model: $24.4B).
- Margin alone
FY2030 EBIT margin would need to reach 12.5% (model: 14.7%).
Other
- Revenue alone
- This business alone cannot get there within the search range.
- Margin alone
- This business alone cannot get there within the search range.
Mechanical requirements, not forecasts. The separate sales-only and single-business factors are searched from 0.1× to 6×; an unsolved comparison means this business alone cannot get there within those bounds. Single-business revenue changes apply from FY2 onward; margin changes scale the full EBIT or EBITDA margin path. Mixed groups show revenue-weighted EBIT and EBITDA margins separately. Requirements above 100% are not feasible margins. Joint rows instead search non-negative uniform margin factors only up to the EBIT/EBITDA guardrails; the entire margin path scales, including post-FY2030 convergence. Sales and margins change together only in that table. The rate search runs from the largest terminal growth rate plus 0.5 percentage points to 30% WACC.
The discount rate
- Cost of equity
- 8.60%
- WACC
- 7.76%
- 10-year Treasury · model / spot
- 3.87% · 5.13%
r_f 3.87% (5-year average 10-year Treasury yield 3.87% (spot 5.13% on 2026-10-21)) + β 0.95 = 0.8 floor relevered for debt/equity 0.21 (§4.5 leverage rule) × 5%, rounded to 0.01% (1bp)
methodology §4.5: market-weighted WACC, not rounded
The model uses the recorded 5-year average Treasury yield. The spot yield is shown for context.
Every input, with its source
Show 66 inputs · reported, guidance and rule-based
| Input | Value | Basis | Why |
|---|---|---|---|
| Revenue FY2026Software | $32.3B | Rule | target (methodology §4.2), growth 7.9% sec.gov ↗ |
| Revenue FY2030Software | $48.3B | Guidance | target (methodology §4.2), growth 10.5% sec.gov ↗ |
| EBIT margin FY2030Software | 37.1% | Rule | linear path to 37.1% by FY2030 (§4.3 E2: 4.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 10.0% to FY2030; no cited expansion evidence) sec.gov ↗ |
| Maintenance capexSoftware | 2.5% | Rule | Capital spending allocation, at least PPE depreciation; explicit reinvestment assumption. sec.gov ↗ |
| Terminal growthSoftware | 2.0% | Rule | methodology §4.2 terminal growth for a mature line Valuation methodology §4.2 · Read methodology ↗ |
| Revenue FY2026Consulting | $21.1B | Reported | target (methodology §4.2), growth 0.2% sec.gov ↗ |
| Revenue FY2030Consulting | $24.4B | Guidance | target (methodology §4.2), growth 3.7% sec.gov ↗ |
| EBIT margin FY2030Consulting | 14.7% | Rule | linear path to 14.7% by FY2030 (§4.3 E2: 3.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 3.0% to FY2030; no cited expansion evidence) sec.gov ↗ |
| Maintenance capexConsulting | 2.5% | Rule | Capital spending allocation, at least PPE depreciation; explicit reinvestment assumption. sec.gov ↗ |
| Terminal growthConsulting | 2.0% | Rule | methodology §4.2 terminal growth for a mature line Valuation methodology §4.2 · Read methodology ↗ |
| Revenue FY2026Infrastructure | $16.4B | Reported | target (methodology §4.2), growth 4.2% sec.gov ↗ |
| Revenue FY2030Infrastructure | $17.4B | Guidance | target (methodology §4.2), growth 1.5% sec.gov ↗ |
| EBIT margin FY2030Infrastructure | 26.0% | Rule | linear path to 26.0% by FY2030 (+4 points, no cited target: cited expansion evidence) sec.gov ↗ |
| Maintenance capexInfrastructure | 2.5% | Rule | Capital spending allocation, at least PPE depreciation; explicit reinvestment assumption. sec.gov ↗ |
| Terminal growthInfrastructure | 2.0% | Rule | methodology §4.2 terminal growth for a mature line Valuation methodology §4.2 · Read methodology ↗ |
| Revenue FY2026Other | $63M | Rule | target (methodology §4.2), growth 0.0% sec.gov ↗ |
| Revenue FY2030Other | $63M | Guidance | target (methodology §4.2), growth 0.0% sec.gov ↗ |
| EBIT margin FY2030Other | 0.0% | Rule | linear path to 0.0% by FY2030 (§4.3 E2: 0.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 0.0% to FY2030; no cited expansion evidence) sec.gov ↗ |
| Maintenance capexOther | 2.0% | Rule | Revenue reconciliation item with no separately allocated profit: reinvestment set equal to its PPE depreciation allocation, so the line carries no separate cash cost (2026-10-21, after the §4.3 growth test removed its +4-point margin). sec.gov ↗ |
| Terminal growthOther | 2.0% | Rule | methodology §4.2 terminal growth for a mature line Valuation methodology §4.2 · Read methodology ↗ |
| Common equityFinancing | $1.4B | Reported | Financing segment equity at September 30, 2026 is $1.406B in Balance Sheet and Return on Equity Highlights; financing debt is $12.652B, primarily intercompany. Same T0 as the group balance; not IBM consolidated equity. sec.gov ↗ |
| Return on equity FY2026Financing | 32.3% | Reported | FY2025 disclosed financing return on five-quarter average equity 32.3%; not segment pretax margin 70.7%. sec.gov ↗ |
| Return on equity FY2030Financing | 32.3% | Reported | latest return held without a management target (methodology §4.6) sec.gov ↗ |
| Payout ratioFinancing | 100.0% | Rule | Existing constant Financing equity convention retained: reported September 30 debt/equity remains 9:1, with no independent asset-growth target or future segment dividend pledge. Distribute earnings to parent and retain current $1.406B capital. This is a model assumption, not a reported dividend rate. sec.gov ↗ |
| Allocated group debt (2026-09-30)Financing | $12.7B | Reported | IBM September 30 debt bridge: group $63.817B, Financing $12.652B and Non-Financing $51.166B ($1M source rounding). Funding is primarily intercompany, but this is IBM's explicit allocation of consolidated debt supporting Financing assets, not an added internal liability. sec.gov ↗ |
| Allocated finance leasesFinancing | $0.0B | Reported | Group reported debt already includes finance lease obligations ($1.240B in the September 30 Borrowings note). Financing funding remains IBM's disclosed debt allocation; retain zero additional subsidiary lease deduction to avoid adding a second liability. No standalone Financing lease amount is disclosed. sec.gov ↗ |
| Allocated group cashFinancing | $0.0B | Reported | September 30 Financing balance highlights do not identify separately earmarked treasury cash. Retain the existing explicit allocation convention: no group cash assigned to Financing, all reported group cash remains in the operating bridge; zero is an allocation, not a claim that the subsidiary has no cash. sec.gov ↗ |
| Terminal growthFinancing | 2.0% | Rule | methodology §4.2 terminal growth for a mature line Valuation methodology §4.2 · Read methodology ↗ |
| Share of revenue FY2026Company costs | 7.1% | Reported | Annual cost baseline $4.756B; scales with operating revenue; full reconciliation in research sec.gov ↗ |
| Share of revenue FY2034Company costs | 7.1% | Reported | Annual cost baseline $4.756B; scales with operating revenue; full reconciliation in research sec.gov ↗ |
| WACCDiscount rates | 7.76% | Rule | methodology §4.5: market-weighted WACC, not rounded FRED DGS10 2021-10-20..2026-10-21 |
| Cost of equityDiscount rates | 8.60% | Rule | r_f 3.87% (5-year average 10-year Treasury yield 3.87% (spot 5.13% on 2026-10-21)) + β 0.95 = 0.8 floor relevered for debt/equity 0.21 (§4.5 leverage rule) × 5%, rounded to 0.01% (1bp) 60 monthly returns vs SPY, 2021-09..2026-09 (adjusted closes) |
| Tax rateDiscount rates | 15.0% | Rule | Normalized effective tax assumption from reported/guided rate; see notes. sec.gov ↗ |
| Revenue eliminated FY2026Consolidation | $0.0B | Rule | FY2026: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2027Consolidation | $0.0B | Rule | FY2027: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2028Consolidation | $0.0B | Rule | FY2028: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2029Consolidation | $0.0B | Rule | FY2029: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2030Consolidation | $0.0B | Rule | FY2030: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2031Consolidation | $0.0B | Rule | FY2031: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2032Consolidation | $0.0B | Rule | FY2032: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2033Consolidation | $0.0B | Rule | FY2033: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Revenue eliminated FY2034Consolidation | $0.0B | Rule | FY2034: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2026Consolidation | −$31M | Rule | FY2026: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2027Consolidation | −$31M | Rule | FY2027: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2028Consolidation | −$31M | Rule | FY2028: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2029Consolidation | −$31M | Rule | FY2029: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2030Consolidation | −$31M | Rule | FY2030: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2031Consolidation | −$31M | Rule | FY2031: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2032Consolidation | −$31M | Rule | FY2032: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2033Consolidation | −$31M | Rule | FY2033: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| Profit eliminated FY2034Consolidation | −$31M | Rule | FY2034: Already-external revenue 67.472+.063=67.535B: revenue elimination 0. NoteD unallocated corporate/other NET credit+.031B covers internal eliminations and miscellaneous items; use the whole net adjustment, not an invented isolated internal-profit number. sec.gov ↗ |
| fiscalYearHistorical accounting reconciliation | FY2025 | Reported | Full fiscal year ended in 2025; same-period accounting reconciliation. sec.gov ↗ |
| grossRevenueBHistorical accounting reconciliation | $67.5B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| revenueEliminationsBHistorical accounting reconciliation | $0.0B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| consolidatedRevenueBHistorical accounting reconciliation | $67.5B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| segmentProfitBHistorical accounting reconciliation | $16.4B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| profitEliminationsBHistorical accounting reconciliation | −$31M | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| corporateCostsBHistorical accounting reconciliation | $4.8B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| operatingInterestBHistorical accounting reconciliation | $1.3B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| consolidatedPretaxBHistorical accounting reconciliation | $10.3B | Reported | NoteD: operating profit 9.920+2.464+3.458 and Financing pretax.521. 16.364+.031-4.756-1.312=10.327 versus 10.328B reported ($1M rounding). Operating segments have no allocated funding interest, so EBT proxies EBIT; Financing funding expense.365 stays in after-tax ROE. sec.gov ↗ |
| Cash and short-term investmentsBalance sheet | $11.1B | Reported | cash, cash equivalents and short-term investments us-gaap:CashAndCashEquivalentsAtCarryingValue + us-gaap:DebtSecuritiesAvailableForSaleExcludingAccruedInterestCurrent · 0000051143-26-000095 (filed 2026-10-22) |
| BorrowingsBalance sheet | $62.6B | Reported | borrowings due within a year plus long-term borrowings; finance leases already included in combined debt tags removed and deducted separately sec.gov ↗ |
| Finance leasesBalance sheet | $1.2B | Reported | finance lease liabilities (capex-like; deducted once) sec.gov ↗ |
| Minority interestsBalance sheet | $0.7B | Reported | noncontrolling interests at book value us-gaap:MinorityInterest · 0000051143-26-000095 (filed 2026-10-22) |
| SharesBalance sheet | 0.945B | Reported | shares outstanding as of 2026-09-30 cover page of 10-Q 0000051143-26-000095 |
| Dividends per yearShareholders | $6.4B | Reported | Last four paid dividends: two at$1.68 and two at$1.69=$6.74; April 2026 increase begins withJune payment. × 0.945B shares sec.gov ↗ |
Research notes
- share-count comparison: 0.953523487B quarter 2026-07-01..2026-09-30 · 0000051143-26-000095; point-in-time denominator retained
- unallocated company costs: $4.8B a year (7.0% of trailing revenue), growing with the lines, valued as one negative business
- cost of equity 8.60% (β 0.95 = 0.8 floor relevered for debt/equity 0.21 (§4.5 leverage rule)), WACC 7.8%
- §4.5 leverage: D/E 0.215, net debt/EBITDA 3.23, β_lev 0.946, β 0.819 → 0.946; D $51.16B, E $238.27B, cash $11.06B, base EBITDA $12.42B
- Consulting: FY2030 margin set to 14.7% instead of 15.7% (§4.3 E2: 3.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 3.0% to FY2030; no cited expansion evidence)
- Other: FY2030 margin set to 0.0% instead of 4.0% (§4.3 E2: 0.0000 points = 4pp × clamp((CAGR − 1.5%) / 2%, 0, 1); revenue CAGR 0.0% to FY2030; no cited expansion evidence)
- Financing: residual income on $1.4B of common equity, earnings = ROE × equity, payout 100% (methodology §3.7)
Signal Ledger research under one stated scenario — management's targets are delivered — not a forecast that they will be and not investment advice. The research desk (GPT-6.1 (Codex)) gathers filings, guidance and targets; deterministic code applies the samepublished rules to every company and checks the result. Inputs may contain errors; follow the source links before relying on them. Read our valuation methodology →