EA vs. IBM: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at EA and IBM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | EA | IBM |
|---|---|---|
| Company Name | Electronic Arts Inc. | International Business Machines Corporation |
| Country | United States | United States |
| GICS Sector | Communication Services | Information Technology |
| GICS Industry | Entertainment | IT Services |
| Market Capitalization | 50.19 billion USD | 278.03 billion USD |
| Exchange | NasdaqGS | NYSE |
| Listing Date | September 20, 1989 | January 2, 1962 |
| Security Type | Common Stock | Common Stock |
Historical Performance
This chart compares the performance of EA and IBM by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.
Historical Performance at a Glance
| Symbol | EA | IBM |
|---|---|---|
| 5-Day Price Return | 0.03% | -5.00% |
| 13-Week Price Return | 17.24% | 21.30% |
| 26-Week Price Return | 33.65% | 8.19% |
| 52-Week Price Return | 21.06% | 38.12% |
| Month-to-Date Return | 0.53% | -5.53% |
| Year-to-Date Return | 37.47% | 32.10% |
| 10-Day Avg. Volume | 2.04M | 4.53M |
| 3-Month Avg. Volume | 3.31M | 5.53M |
| 3-Month Volatility | 32.69% | 28.75% |
| Beta | 0.73 | 0.69 |
Profitability
Return on Equity (TTM)
EA
13.68%
Entertainment Industry
- Max
- 41.86%
- Q3
- 22.17%
- Median
- 13.67%
- Q1
- 4.55%
- Min
- -17.95%
EA’s Return on Equity of 13.68% is on par with the norm for the Entertainment industry, indicating its profitability relative to shareholder equity is typical for the sector.
IBM
28.86%
IT Services Industry
- Max
- 37.08%
- Q3
- 19.28%
- Median
- 14.70%
- Q1
- 6.70%
- Min
- -8.16%
In the upper quartile for the IT Services industry, IBM’s Return on Equity of 28.86% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
Net Profit Margin (TTM)
EA
12.14%
Entertainment Industry
- Max
- 45.33%
- Q3
- 29.05%
- Median
- 15.14%
- Q1
- 4.44%
- Min
- -21.70%
EA’s Net Profit Margin of 12.14% is aligned with the median group of its peers in the Entertainment industry. This indicates its ability to convert revenue into profit is typical for the sector.
IBM
12.09%
IT Services Industry
- Max
- 17.01%
- Q3
- 11.02%
- Median
- 6.91%
- Q1
- 3.07%
- Min
- -5.13%
A Net Profit Margin of 12.09% places IBM in the upper quartile for the IT Services industry, signifying strong profitability and more effective cost management than most of its peers.
Operating Profit Margin (TTM)
EA
17.06%
Entertainment Industry
- Max
- 43.42%
- Q3
- 28.90%
- Median
- 18.77%
- Q1
- 9.11%
- Min
- -4.88%
EA’s Operating Profit Margin of 17.06% is around the midpoint for the Entertainment industry, indicating that its efficiency in managing core business operations is typical for the sector.
IBM
14.51%
IT Services Industry
- Max
- 23.01%
- Q3
- 15.32%
- Median
- 9.57%
- Q1
- 4.91%
- Min
- -9.58%
IBM’s Operating Profit Margin of 14.51% is around the midpoint for the IT Services industry, indicating that its efficiency in managing core business operations is typical for the sector.
Profitability at a Glance
| Symbol | EA | IBM |
|---|---|---|
| Return on Equity (TTM) | 13.68% | 28.86% |
| Return on Assets (TTM) | 7.17% | 5.48% |
| Net Profit Margin (TTM) | 12.14% | 12.09% |
| Operating Profit Margin (TTM) | 17.06% | 14.51% |
| Gross Profit Margin (TTM) | 78.79% | 57.81% |
Financial Strength
Current Ratio (MRQ)
EA
0.84
Entertainment Industry
- Max
- 6.76
- Q3
- 4.06
- Median
- 1.58
- Q1
- 0.87
- Min
- 0.38
EA’s Current Ratio of 0.84 falls into the lower quartile for the Entertainment industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
IBM
0.93
IT Services Industry
- Max
- 3.02
- Q3
- 1.91
- Median
- 1.36
- Q1
- 1.02
- Min
- 0.49
IBM’s Current Ratio of 0.93 falls into the lower quartile for the IT Services industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
Debt-to-Equity Ratio (MRQ)
EA
0.31
Entertainment Industry
- Max
- 1.54
- Q3
- 0.80
- Median
- 0.15
- Q1
- 0.01
- Min
- 0.00
EA’s Debt-to-Equity Ratio of 0.31 is typical for the Entertainment industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
IBM
2.26
IT Services Industry
- Max
- 2.55
- Q3
- 1.30
- Median
- 0.55
- Q1
- 0.14
- Min
- 0.00
IBM’s leverage is in the upper quartile of the IT Services industry, with a Debt-to-Equity Ratio of 2.26. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
Interest Coverage Ratio (TTM)
EA
190.43
Entertainment Industry
- Max
- 62.11
- Q3
- 35.59
- Median
- 7.06
- Q1
- 1.13
- Min
- -44.74
With an Interest Coverage Ratio of 190.43, EA demonstrates a superior capacity to service its debt, placing it well above the typical range for the Entertainment industry. This stems from either robust earnings or a conservative debt load.
IBM
45.57
IT Services Industry
- Max
- 129.00
- Q3
- 56.00
- Median
- 11.69
- Q1
- 1.68
- Min
- -28.15
IBM’s Interest Coverage Ratio of 45.57 is positioned comfortably within the norm for the IT Services industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | EA | IBM |
|---|---|---|
| Current Ratio (MRQ) | 0.84 | 0.93 |
| Quick Ratio (MRQ) | 0.84 | 0.81 |
| Debt-to-Equity Ratio (MRQ) | 0.31 | 2.26 |
| Interest Coverage Ratio (TTM) | 190.43 | 45.57 |
Growth
Revenue Growth
EPS Growth
Dividend
Dividend Yield (TTM)
EA
0.39%
Entertainment Industry
- Max
- 2.71%
- Q3
- 1.23%
- Median
- 0.60%
- Q1
- 0.00%
- Min
- 0.00%
EA’s Dividend Yield of 0.39% is consistent with its peers in the Entertainment industry, providing a dividend return that is standard for its sector.
IBM
2.27%
IT Services Industry
- Max
- 4.66%
- Q3
- 2.02%
- Median
- 0.66%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 2.27%, IBM offers a more attractive income stream than most of its peers in the IT Services industry, signaling a strong commitment to shareholder returns.
Dividend Payout Ratio (TTM)
EA
21.92%
Entertainment Industry
- Max
- 82.30%
- Q3
- 37.50%
- Median
- 24.18%
- Q1
- 0.00%
- Min
- 0.00%
EA’s Dividend Payout Ratio of 21.92% is within the typical range for the Entertainment industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
IBM
78.74%
IT Services Industry
- Max
- 93.78%
- Q3
- 63.22%
- Median
- 24.64%
- Q1
- 0.00%
- Min
- 0.00%
IBM’s Dividend Payout Ratio of 78.74% is in the upper quartile for the IT Services industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.
Dividend at a Glance
| Symbol | EA | IBM |
|---|---|---|
| Dividend Yield (TTM) | 0.39% | 2.27% |
| Dividend Payout Ratio (TTM) | 21.92% | 78.74% |
Valuation
Price-to-Earnings Ratio (TTM)
EA
56.64
Entertainment Industry
- Max
- 80.06
- Q3
- 53.00
- Median
- 28.44
- Q1
- 18.00
- Min
- 2.61
A P/E Ratio of 56.64 places EA in the upper quartile for the Entertainment industry. This high valuation relative to peers suggests the market holds elevated expectations for the company’s future growth.
IBM
34.77
IT Services Industry
- Max
- 45.03
- Q3
- 30.25
- Median
- 21.01
- Q1
- 16.50
- Min
- 0.00
A P/E Ratio of 34.77 places IBM in the upper quartile for the IT Services industry. This high valuation relative to peers suggests the market holds elevated expectations for the company’s future growth.
Price-to-Sales Ratio (TTM)
EA
6.88
Entertainment Industry
- Max
- 10.86
- Q3
- 6.98
- Median
- 4.25
- Q1
- 2.56
- Min
- 0.51
EA’s P/S Ratio of 6.88 aligns with the market consensus for the Entertainment industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
IBM
4.20
IT Services Industry
- Max
- 5.24
- Q3
- 4.01
- Median
- 2.18
- Q1
- 1.08
- Min
- 0.00
IBM’s P/S Ratio of 4.20 is in the upper echelon for the IT Services industry. This means the company is valued richly on its revenue stream compared to its peers, suggesting the stock is priced for a high level of future performance.
Price-to-Book Ratio (MRQ)
EA
8.38
Entertainment Industry
- Max
- 19.63
- Q3
- 10.35
- Median
- 5.18
- Q1
- 2.07
- Min
- 0.59
EA’s P/B Ratio of 8.38 is within the conventional range for the Entertainment industry. This shows a balanced market view, where the stock’s price is neither at a significant premium nor a discount to the book value of its peers.
IBM
9.42
IT Services Industry
- Max
- 9.42
- Q3
- 5.79
- Median
- 3.70
- Q1
- 2.30
- Min
- 0.79
IBM’s P/B Ratio of 9.42 is in the upper tier for the IT Services industry. This indicates that investors are paying a premium relative to the company’s net assets, a valuation that hinges on its ability to generate superior profits.
Valuation at a Glance
| Symbol | EA | IBM |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 56.64 | 34.77 |
| Price-to-Sales Ratio (TTM) | 6.88 | 4.20 |
| Price-to-Book Ratio (MRQ) | 8.38 | 9.42 |
| Price-to-Free Cash Flow Ratio (TTM) | 29.35 | 22.96 |