EPAM vs. IBM: A Head-to-Head Stock Comparison
Here’s a clear look at EPAM and IBM, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | EPAM | IBM |
|---|---|---|
| Company Name | EPAM Systems, Inc. | International Business Machines Corporation |
| Country | United States | United States |
| GICS Sector | Information Technology | Information Technology |
| GICS Industry Group | Software & Services | Software & Services |
| GICS Industry | IT Services | IT Services |
| GICS Sub-Industry | IT Consulting & Other Services | IT Consulting & Other Services |
| Market Capitalization | 5.18 billion USD | 210.11 billion USD |
| Currency | USD | USD |
| Exchange | NYSE | NYSE |
| Listing Date | February 8, 2012 | January 2, 1962 |
| Security Type | Common Stock | Common Stock |
IBM’s market capitalization (210.11 billion USD) is significantly greater than EPAM’s (5.18 billion USD), highlighting its more substantial market valuation.
Historical Performance
This chart compares the performance of EPAM 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 | EPAM | IBM |
|---|---|---|
| 5-Day Price Return | -10.28% | -2.39% |
| 13-Week Price Return | -44.09% | -25.22% |
| 26-Week Price Return | -39.32% | -26.64% |
| 52-Week Price Return | -44.78% | -10.29% |
| Month-to-Date Return | -12.79% | -3.22% |
| Year-to-Date Return | -51.57% | -24.53% |
| 10-Day Avg. Volume | 1.76M | 5.49M |
| 3-Month Avg. Volume | 1.27M | 5.93M |
| 3-Month Volatility | 53.62% | 44.19% |
| Beta | 1.44 | 0.56 |
EPAM’s beta of 1.44 points to significantly higher volatility compared to IBM (beta: 0.56), suggesting EPAM has greater potential for both gains and losses relative to market movements.
Profitability
Return on Equity (TTM)
EPAM
10.27%
IT Services Industry
- Max
- 38.00%
- Q3
- 18.66%
- Median
- 14.40%
- Q1
- 2.80%
- Min
- -20.08%
EPAM’s Return on Equity of 10.27% is on par with the norm for the IT Services industry, indicating its profitability relative to shareholder equity is typical for the sector.
IBM
35.53%
IT Services Industry
- Max
- 38.00%
- Q3
- 18.66%
- Median
- 14.40%
- Q1
- 2.80%
- Min
- -20.08%
In the upper quartile for the IT Services industry, IBM’s Return on Equity of 35.53% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
Net Profit Margin (TTM)
EPAM
6.92%
IT Services Industry
- Max
- 20.89%
- Q3
- 10.75%
- Median
- 7.13%
- Q1
- 1.94%
- Min
- -9.79%
EPAM’s Net Profit Margin of 6.92% is aligned with the median group of its peers in the IT Services industry. This indicates its ability to convert revenue into profit is typical for the sector.
IBM
15.60%
IT Services Industry
- Max
- 20.89%
- Q3
- 10.75%
- Median
- 7.13%
- Q1
- 1.94%
- Min
- -9.79%
A Net Profit Margin of 15.60% 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)
EPAM
9.53%
IT Services Industry
- Max
- 23.73%
- Q3
- 14.65%
- Median
- 9.36%
- Q1
- 4.97%
- Min
- -8.09%
EPAM’s Operating Profit Margin of 9.53% is around the midpoint for the IT Services industry, indicating that its efficiency in managing core business operations is typical for the sector.
IBM
15.32%
IT Services Industry
- Max
- 23.73%
- Q3
- 14.65%
- Median
- 9.36%
- Q1
- 4.97%
- Min
- -8.09%
An Operating Profit Margin of 15.32% places IBM in the upper quartile for the IT Services industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
Profitability at a Glance
| Symbol | EPAM | IBM |
|---|---|---|
| Return on Equity (TTM) | 10.27% | 35.53% |
| Return on Assets (TTM) | 7.88% | 7.13% |
| Net Profit Margin (TTM) | 6.92% | 15.60% |
| Operating Profit Margin (TTM) | 9.53% | 15.32% |
| Gross Profit Margin (TTM) | 28.88% | 58.36% |
Financial Strength
Current Ratio (MRQ)
EPAM
2.59
IT Services Industry
- Max
- 2.61
- Q3
- 1.98
- Median
- 1.41
- Q1
- 1.00
- Min
- 0.36
EPAM’s Current Ratio of 2.59 is in the upper quartile for the IT Services industry. This signifies a strong liquidity position, suggesting the company is well-equipped to cover its immediate liabilities compared to its peers.
IBM
0.80
IT Services Industry
- Max
- 2.61
- Q3
- 1.98
- Median
- 1.41
- Q1
- 1.00
- Min
- 0.36
IBM’s Current Ratio of 0.80 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)
EPAM
0.01
IT Services Industry
- Max
- 2.24
- Q3
- 1.10
- Median
- 0.51
- Q1
- 0.13
- Min
- 0.00
Falling into the lower quartile for the IT Services industry, EPAM’s Debt-to-Equity Ratio of 0.01 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
IBM
2.01
IT Services Industry
- Max
- 2.24
- Q3
- 1.10
- Median
- 0.51
- Q1
- 0.13
- Min
- 0.00
IBM’s leverage is in the upper quartile of the IT Services industry, with a Debt-to-Equity Ratio of 2.01. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
Interest Coverage Ratio (TTM)
EPAM
29.33
IT Services Industry
- Max
- 100.81
- Q3
- 50.30
- Median
- 15.71
- Q1
- 1.44
- Min
- -28.15
EPAM’s Interest Coverage Ratio of 29.33 is positioned comfortably within the norm for the IT Services industry, indicating a standard and healthy capacity to cover its interest payments.
IBM
45.57
IT Services Industry
- Max
- 100.81
- Q3
- 50.30
- Median
- 15.71
- Q1
- 1.44
- 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 | EPAM | IBM |
|---|---|---|
| Current Ratio (MRQ) | 2.59 | 0.80 |
| Quick Ratio (MRQ) | 2.46 | 0.68 |
| Debt-to-Equity Ratio (MRQ) | 0.01 | 2.01 |
| Interest Coverage Ratio (TTM) | 29.33 | 45.57 |
Growth
Revenue Growth
Revenue Growth at a Glance
| Symbol | EPAM | IBM |
|---|---|---|
| Revenue Growth (MRQ vs Prior YoY) | 12.75% | 9.46% |
| Revenue Growth (TTM vs Prior YoY) | 15.42% | 9.67% |
| 3-Year Revenue CAGR | 4.19% | 3.72% |
| 5-Year Revenue CAGR | 15.46% | 4.12% |
EPS Growth
EPS Growth at a Glance
| Symbol | EPAM | IBM |
|---|---|---|
| EPS Growth (MRQ vs Prior YoY) | 9.89% | 14.24% |
| EPS Growth (TTM vs Prior YoY) | -14.17% | 94.45% |
| 3-Year EPS CAGR | -1.76% | 83.85% |
| 5-Year EPS CAGR | 3.69% | 12.36% |
Dividend
Dividend Yield (TTM)
EPAM
0.00%
IT Services Industry
- Max
- 5.48%
- Q3
- 2.33%
- Median
- 0.83%
- Q1
- 0.00%
- Min
- 0.00%
EPAM currently does not pay a dividend, resulting in a yield of 0%. This is a common strategy for growth-focused companies that prioritize reinvesting earnings, though it may be less typical in mature, income-oriented sectors.
IBM
2.99%
IT Services Industry
- Max
- 5.48%
- Q3
- 2.33%
- Median
- 0.83%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 2.99%, 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)
EPAM
0.00%
IT Services Industry
- Max
- 93.78%
- Q3
- 42.50%
- Median
- 18.30%
- Q1
- 0.00%
- Min
- 0.00%
EPAM has a Dividend Payout Ratio of 0%, indicating it does not currently pay a dividend. This is a common strategy for growth-oriented companies that reinvest all profits back into the business.
IBM
58.43%
IT Services Industry
- Max
- 93.78%
- Q3
- 42.50%
- Median
- 18.30%
- Q1
- 0.00%
- Min
- 0.00%
IBM’s Dividend Payout Ratio of 58.43% 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 | EPAM | IBM |
|---|---|---|
| Dividend Yield (TTM) | 0.00% | 2.99% |
| Dividend Payout Ratio (TTM) | 0.00% | 58.43% |
Valuation
Price-to-Earnings Ratio (TTM)
EPAM
13.86
IT Services Industry
- Max
- 48.11
- Q3
- 29.84
- Median
- 15.98
- Q1
- 12.08
- Min
- 3.80
EPAM’s P/E Ratio of 13.86 is within the middle range for the IT Services industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
IBM
19.52
IT Services Industry
- Max
- 48.11
- Q3
- 29.84
- Median
- 15.98
- Q1
- 12.08
- Min
- 3.80
IBM’s P/E Ratio of 19.52 is within the middle range for the IT Services industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
Price-to-Sales Ratio (TTM)
EPAM
0.96
IT Services Industry
- Max
- 9.77
- Q3
- 5.15
- Median
- 1.67
- Q1
- 1.10
- Min
- 0.18
In the lower quartile for the IT Services industry, EPAM’s P/S Ratio of 0.96 indicates its revenue is valued more conservatively than most of its peers. This could present a compelling opportunity if the market has overlooked its sales-generating capabilities.
IBM
3.05
IT Services Industry
- Max
- 9.77
- Q3
- 5.15
- Median
- 1.67
- Q1
- 1.10
- Min
- 0.18
IBM’s P/S Ratio of 3.05 aligns with the market consensus for the IT Services industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio (MRQ)
EPAM
3.08
IT Services Industry
- Max
- 10.70
- Q3
- 5.80
- Median
- 3.76
- Q1
- 2.53
- Min
- 1.51
EPAM’s P/B Ratio of 3.08 is within the conventional range for the IT Services 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
6.91
IT Services Industry
- Max
- 10.70
- Q3
- 5.80
- Median
- 3.76
- Q1
- 2.53
- Min
- 1.51
IBM’s P/B Ratio of 6.91 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 | EPAM | IBM |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 13.86 | 19.52 |
| Price-to-Sales Ratio (TTM) | 0.96 | 3.05 |
| Price-to-Book Ratio (MRQ) | 3.08 | 6.91 |
| Price-to-Free Cash Flow Ratio (TTM) | 8.54 | 17.12 |