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IBM vs. PANW: IBM vs. Palo Alto Networks Stock Comparison

How do IBM (IBM) and Palo Alto Networks (PANW) stack up? This page sets them side by side across company profile, performance and risk, profitability, growth, financial strength, dividends, and valuation, with selected fundamentals also measured against each stock's industry-group peers.

Company Profile

IBM (IBM) and Palo Alto Networks (PANW) both fall under the Software & Services industry group, but IBM is classified in IT Services while PANW is classified in Software.

Company profile comparison for IBM (IBM) and Palo Alto Networks (PANW)
Profile ItemIBMPANW
NameInternational Business Machines CorporationPalo Alto Networks, Inc.
Country/RegionUnited StatesUnited States
GICS SectorInformation TechnologyInformation Technology
GICS Industry GroupSoftware & ServicesSoftware & Services
GICS IndustryIT ServicesSoftware
GICS Sub-IndustryIT Consulting & Other ServicesSystems Software
Market Capitalization264.31 billion USD277.93 billion USD
CurrencyUSDUSD
ExchangeNYSENasdaq
Listing DateJanuary 2, 1962July 20, 2012
Security TypeCommon StockCommon Stock

Price Performance

Cumulative Growth

IBM
PANW
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IBM (IBM) vs. Palo Alto Networks (PANW): Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

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Trailing total returns for IBM (IBM) and Palo Alto Networks (PANW). Returns over one year are annualized.

Performance Metrics

Price performance metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
Total Return (1Y)-2.16%66.64%

Risk Profile

Drawdown History

IBM
PANW
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IBM (IBM) vs. Palo Alto Networks (PANW): Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Risk Metrics

Risk profile metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
Volatility (1Y, Annualized)40.54%40.33%
Beta (5Y)0.680.91
Avg. Volume (3M)8.55M8.32M

Risk-Adjusted Performance

Risk-Return Positioning

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IBM and PANW are plotted by 1-year volatility (risk) and 1-year return. The dashed Capital Allocation Line runs from the risk-free rate through the shared industry median.

Profitability

ROE (TTM)

IBM (IBM) at 35.77% sits in the top ROE quartile, while Palo Alto Networks (PANW) at 4.83% is closer to the peer norm — stronger capital efficiency for IBM.

IBM

Software & Services industry group

35.77%

Max
53.38%
IBM
35.77%
Q3
16.53%
Median
5.38%
Q1
-13.43%
Min
-55.27%

PANW

Software & Services industry group

4.83%

Max
53.38%
Q3
16.53%
Median
5.38%
PANW
4.83%
Q1
-13.43%
Min
-55.27%
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their ROE against the Software & Services industry group benchmark.

Net Margin (TTM)

IBM (IBM) at 15.61% retains a top-quartile share of revenue as profit, ahead of Palo Alto Networks (PANW) at 7.95%, which keeps about the industry-typical share.

IBM

Software & Services industry group

15.61%

Max
44.20%
IBM
15.61%
Q3
14.93%
Median
3.32%
Q1
-5.99%
Min
-34.99%

PANW

Software & Services industry group

7.95%

Max
44.20%
Q3
14.93%
PANW
7.95%
Median
3.32%
Q1
-5.99%
Min
-34.99%
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their net margin against the Software & Services industry group benchmark.

Operating Margin (TTM)

Palo Alto Networks (PANW) reports a negative operating margin of -2.47%, usually indicating that operating costs exceeded revenue at the operating-income line. Meanwhile IBM (IBM) reports 13.81%, ranking against industry peers normally.

IBM

Software & Services industry group

13.81%

Max
60.45%
Q3
16.49%
IBM
13.81%
Median
4.46%
Q1
-12.92%
Min
-53.94%

PANW

Software & Services industry group

-2.47%

Max
60.45%
Q3
16.49%
Median
4.46%
PANW
-2.47%
Q1
-12.92%
Min
-53.94%
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their operating margin against the Software & Services industry group benchmark.

Profitability Metrics

Profitability metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
ROE (TTM)35.77%4.83%
ROA (TTM)5.37%1.77%
Net Margin (TTM)15.61%7.95%
Operating Margin (TTM)13.81%-2.47%
Gross Margin (TTM)58.36%71.96%

Growth

Revenue Growth

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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their Revenue Growth across different time periods.

Revenue Growth Metrics

Revenue growth metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
Revenue Growth (YoY)7.62%14.87%
Revenue Growth (3Y CAGR)3.72%18.79%

EPS Growth

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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their EPS Growth across different time periods.

EPS Growth Metrics

EPS growth metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
EPS Growth (YoY)73.72%-56.04%
EPS Growth (3Y CAGR)83.76%--

Financial Strength

Current Ratio (MRQ)

Both IBM (IBM) at 0.80 and Palo Alto Networks (PANW) at 0.86 run current ratio in the tighter-liquidity quartile of industry peers, leaving thinner cushions against current liabilities than typical competitors.

IBM

Software & Services industry group

0.80

Max
5.55
Q3
2.88
Median
1.72
Q1
1.07
IBM
0.80
Min
0.03

PANW

Software & Services industry group

0.86

Max
5.55
Q3
2.88
Median
1.72
Q1
1.07
PANW
0.86
Min
0.03
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their current ratio against the Software & Services industry group benchmark.

Debt / Equity (MRQ)

Palo Alto Networks (PANW) at 0.08 carries an industry-typical debt-to-equity mix, while IBM (IBM) at 2.11 uses more debt funding than most peers.

IBM

Software & Services industry group

2.11

Max
2.31
IBM
2.11
Q3
1.06
Median
0.32
Q1
0.06
Min
0.00

PANW

Software & Services industry group

0.08

Max
2.31
Q3
1.06
Median
0.32
PANW
0.08
Q1
0.06
Min
0.00
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their debt-to-equity ratio against the Software & Services industry group benchmark.

Financial Strength Metrics

Financial strength metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
Current Ratio (MRQ)0.800.86
Debt / Equity (MRQ)2.110.08
Net Debt / EBITDA3.49-0.66

Dividends

Dividend Yield (TTM)

Palo Alto Networks (PANW) pays no dividend (yield 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a yield of 2.42%, ranking against industry peers normally.

IBM

Software & Services industry group

2.42%

IBM
2.42%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%

PANW

Software & Services industry group

0.00%

PANW
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their dividend yield against the Software & Services industry group benchmark.

Dividend Payout Ratio (TTM)

Palo Alto Networks (PANW) pays no dividend (payout 0.00%) — it may be reinvesting, using buybacks, or simply not returning cash through dividends. Meanwhile IBM (IBM) reports a payout of 59.47%, ranking against industry peers normally.

IBM

Software & Services industry group

59.47%

IBM
59.47%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%

PANW

Software & Services industry group

0.00%

PANW
0.00%
Max
0.00%
Q3
0.00%
Median
0.00%
Q1
0.00%
Min
0.00%
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their payout ratio against the Software & Services industry group benchmark.

Dividend Metrics

Dividend metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
Dividend Yield (TTM)2.42%0.00%
Dividend Payout Ratio (TTM)59.47%0.00%

Valuation

P/E Ratio (TTM)

IBM (IBM) at 24.89 is near its industry’s usual P/E ratio, while Palo Alto Networks (PANW) at 293.98 sits above its peer range — an unusually expensive price for PANW’s trailing earnings.

IBM

Software & Services industry group

24.89

Max
126.50
Q3
60.82
Median
30.49
IBM
24.89
Q1
16.22
Min
0.41

PANW

Software & Services industry group

293.98

PANW
293.98
Max
126.50
Q3
60.82
Median
30.49
Q1
16.22
Min
0.41
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their P/E ratio against the Software & Services industry group benchmark.

P/S Ratio (TTM)

IBM (IBM) at 3.84 prices around its industry’s typical P/S ratio, while Palo Alto Networks (PANW) at 26.20 clears its benchmark range — PANW looks notably rich on sales.

IBM

Software & Services industry group

3.84

Max
18.72
Q3
8.93
Median
4.21
IBM
3.84
Q1
2.14
Min
0.02

PANW

Software & Services industry group

26.20

PANW
26.20
Max
18.72
Q3
8.93
Median
4.21
Q1
2.14
Min
0.02
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their P/S ratio against the Software & Services industry group benchmark.

P/B Ratio (MRQ)

IBM (IBM) at 8.02 is valued about in line with its industry on P/B ratio, while Palo Alto Networks (PANW) at 10.02 carries an above-peer premium to book — PANW is pricier on assets.

IBM

Software & Services industry group

8.02

Max
18.46
Q3
8.62
IBM
8.02
Median
4.00
Q1
1.94
Min
-7.57

PANW

Software & Services industry group

10.02

Max
18.46
PANW
10.02
Q3
8.62
Median
4.00
Q1
1.94
Min
-7.57
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IBM (IBM) vs. Palo Alto Networks (PANW): A comparison of their P/B ratio against the Software & Services industry group benchmark.

Valuation Metrics

Valuation metrics for IBM (IBM) and Palo Alto Networks (PANW)
MetricIBMPANW
P/E Ratio (TTM)24.89293.98
P/S Ratio (TTM)3.8426.20
P/B Ratio (MRQ)8.0210.02
Free Cash Flow Yield (TTM)4.95%1.29%