IBM vs. SOUN: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at IBM and SOUN, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
IBM’s market capitalization of 263.57 billion USD is substantially larger than SOUN’s 4.65 billion USD, indicating a significant difference in their market valuations.
SOUN carries a higher beta at 2.87, indicating it’s more sensitive to market moves, while IBM (beta: 0.65) exhibits greater stability.
| Symbol | IBM | SOUN |
|---|---|---|
| Company Name | International Business Machines Corporation | SoundHound AI, Inc. |
| Country | US | US |
| Sector | Technology | Technology |
| Industry | Information Technology Services | Software - Application |
| CEO | Arvind Krishna | Keyvan Mohajer |
| Price | 283.59 USD | 11.57 USD |
| Market Cap | 263.57 billion USD | 4.65 billion USD |
| Beta | 0.65 | 2.87 |
| Exchange | NYSE | NASDAQ |
| IPO Date | September 24, 1915 | April 28, 2022 |
| ADR | No | No |
Historical Performance
This chart compares the performance of IBM and SOUN 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.
Profitability
Return on Equity
IBM
21.32%
Information Technology Services Industry
- Max
- 47.24%
- Q3
- 23.27%
- Median
- 12.85%
- Q1
- 2.22%
- Min
- -26.63%
IBM’s Return on Equity of 21.32% is on par with the norm for the Information Technology Services industry, indicating its profitability relative to shareholder equity is typical for the sector.
SOUN
-68.55%
Software - Application Industry
- Max
- 59.01%
- Q3
- 17.85%
- Median
- 4.73%
- Q1
- -10.56%
- Min
- -52.94%
SOUN has a negative Return on Equity of -68.55%. This indicates the company is generating a loss for its shareholders, which can be a result of unprofitability or negative shareholder equity and is often a sign of financial distress.
Return on Invested Capital
IBM
8.48%
Information Technology Services Industry
- Max
- 28.29%
- Q3
- 13.19%
- Median
- 7.24%
- Q1
- 0.23%
- Min
- -18.82%
IBM’s Return on Invested Capital of 8.48% is in line with the norm for the Information Technology Services industry, reflecting a standard level of efficiency in generating profits from its capital base.
SOUN
-34.12%
Software - Application Industry
- Max
- 35.07%
- Q3
- 9.72%
- Median
- 0.76%
- Q1
- -8.68%
- Min
- -34.12%
SOUN has a negative Return on Invested Capital of -34.12%. This indicates that its operations are failing to generate a profit on the total capital invested, signaling significant inefficiency or value destruction.
Net Profit Margin
IBM
8.71%
Information Technology Services Industry
- Max
- 20.47%
- Q3
- 11.62%
- Median
- 5.97%
- Q1
- 1.89%
- Min
- -4.62%
IBM’s Net Profit Margin of 8.71% is aligned with the median group of its peers in the Information Technology Services industry. This indicates its ability to convert revenue into profit is typical for the sector.
SOUN
-184.34%
Software - Application Industry
- Max
- 48.14%
- Q3
- 16.07%
- Median
- 1.83%
- Q1
- -9.60%
- Min
- -45.64%
SOUN has a negative Net Profit Margin of -184.34%, indicating the company is operating at a net loss as its expenses exceeded its revenues.
Operating Profit Margin
IBM
16.36%
Information Technology Services Industry
- Max
- 29.42%
- Q3
- 14.75%
- Median
- 8.92%
- Q1
- 2.62%
- Min
- -11.92%
An Operating Profit Margin of 16.36% places IBM in the upper quartile for the Information Technology Services industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
SOUN
-184.97%
Software - Application Industry
- Max
- 51.67%
- Q3
- 15.35%
- Median
- 1.79%
- Q1
- -12.42%
- Min
- -45.17%
SOUN has a negative Operating Profit Margin of -184.97%. This signifies the company is unprofitable at the operational level, as its core business expenses exceed its revenue.
Profitability at a Glance
| Symbol | IBM | SOUN |
|---|---|---|
| Return on Equity (TTM) | 21.32% | -68.55% |
| Return on Assets (TTM) | 3.76% | -32.07% |
| Return on Invested Capital (TTM) | 8.48% | -34.12% |
| Net Profit Margin (TTM) | 8.71% | -184.34% |
| Operating Profit Margin (TTM) | 16.36% | -184.97% |
| Gross Profit Margin (TTM) | 57.04% | 44.69% |
Financial Strength
Current Ratio
IBM
1.01
Information Technology Services Industry
- Max
- 3.41
- Q3
- 2.37
- Median
- 1.58
- Q1
- 1.20
- Min
- 0.00
IBM’s Current Ratio of 1.01 falls into the lower quartile for the Information Technology Services industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
SOUN
4.92
Software - Application Industry
- Max
- 5.09
- Q3
- 2.84
- Median
- 1.70
- Q1
- 1.12
- Min
- 0.04
SOUN’s Current Ratio of 4.92 is in the upper quartile for the Software - Application industry. This signifies a strong liquidity position, suggesting the company is well-equipped to cover its immediate liabilities compared to its peers.
Debt-to-Equity Ratio
IBM
2.49
Information Technology Services Industry
- Max
- 2.63
- Q3
- 1.16
- Median
- 0.48
- Q1
- 0.09
- Min
- 0.01
IBM’s leverage is in the upper quartile of the Information Technology Services industry, with a Debt-to-Equity Ratio of 2.49. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
SOUN
0.01
Software - Application Industry
- Max
- 1.85
- Q3
- 0.77
- Median
- 0.18
- Q1
- 0.05
- Min
- 0.00
Falling into the lower quartile for the Software - Application industry, SOUN’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.
Interest Coverage Ratio
IBM
5.92
Information Technology Services Industry
- Max
- 17.52
- Q3
- 10.04
- Median
- 4.66
- Q1
- 0.80
- Min
- -10.50
IBM’s Interest Coverage Ratio of 5.92 is positioned comfortably within the norm for the Information Technology Services industry, indicating a standard and healthy capacity to cover its interest payments.
SOUN
-30.16
Software - Application Industry
- Max
- 39.23
- Q3
- 8.55
- Median
- 1.48
- Q1
- -14.59
- Min
- -39.97
SOUN has a negative Interest Coverage Ratio of -30.16. This indicates that its earnings were insufficient to cover even its operational costs, let alone its interest payments, signaling significant financial distress.
Financial Strength at a Glance
| Symbol | IBM | SOUN |
|---|---|---|
| Current Ratio (TTM) | 1.01 | 4.92 |
| Quick Ratio (TTM) | 0.97 | 4.92 |
| Debt-to-Equity Ratio (TTM) | 2.49 | 0.01 |
| Debt-to-Asset Ratio (TTM) | 0.46 | 0.01 |
| Net Debt-to-EBITDA Ratio (TTM) | 4.53 | 1.36 |
| Interest Coverage Ratio (TTM) | 5.92 | -30.16 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for IBM and SOUN. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
IBM
2.95%
Information Technology Services Industry
- Max
- 16.57%
- Q3
- 1.39%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 2.95%, IBM offers a more attractive income stream than most of its peers in the Information Technology Services industry, signaling a strong commitment to shareholder returns.
SOUN
0.00%
Software - Application Industry
- Max
- 3.66%
- Q3
- 0.00%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
SOUN 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.
Dividend Payout Ratio
IBM
112.81%
Information Technology Services Industry
- Max
- 112.81%
- Q3
- 20.98%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
IBM’s Dividend Payout Ratio of 112.81% is above 100%. This means the company is paying out more in dividends than it earned, a practice that is often unsustainable and could indicate a risk to future dividend stability.
SOUN
0.00%
Software - Application Industry
- Max
- 81.09%
- Q3
- 0.00%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
SOUN 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.
Dividend at a Glance
| Symbol | IBM | SOUN |
|---|---|---|
| Dividend Yield (TTM) | 2.95% | 0.00% |
| Dividend Payout Ratio (TTM) | 112.81% | 0.00% |
Valuation
Price-to-Earnings Ratio
IBM
48.09
Information Technology Services Industry
- Max
- 49.12
- Q3
- 36.91
- Median
- 24.84
- Q1
- 15.88
- Min
- 1.55
A P/E Ratio of 48.09 places IBM in the upper quartile for the Information Technology Services industry. This high valuation relative to peers suggests the market holds elevated expectations for the company’s future growth.
SOUN
-24.18
Software - Application Industry
- Max
- 194.31
- Q3
- 98.56
- Median
- 51.87
- Q1
- 22.76
- Min
- 1.02
SOUN has a negative P/E Ratio of -24.18. This occurs when a company has negative earnings (a net loss), making the ratio unsuitable for valuation analysis.
Forward P/E to Growth Ratio
IBM
9.24
Information Technology Services Industry
- Max
- 5.35
- Q3
- 3.79
- Median
- 2.23
- Q1
- 1.19
- Min
- 0.03
IBM’s Forward PEG Ratio of 9.24 is exceptionally high for the Information Technology Services industry. This suggests its stock price is very high relative to its expected earnings growth, signaling significant overvaluation risk.
SOUN
0.24
Software - Application Industry
- Max
- 15.44
- Q3
- 6.57
- Median
- 2.78
- Q1
- 0.55
- Min
- 0.00
In the lower quartile for the Software - Application industry, SOUN’s Forward PEG Ratio of 0.24 is a positive indicator. It suggests that the stock may be attractively valued relative to its expected earnings growth.
Price-to-Sales Ratio
IBM
4.19
Information Technology Services Industry
- Max
- 8.15
- Q3
- 4.17
- Median
- 2.14
- Q1
- 1.00
- Min
- 0.10
IBM’s P/S Ratio of 4.19 is in the upper echelon for the Information Technology 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.
SOUN
45.47
Software - Application Industry
- Max
- 23.49
- Q3
- 11.14
- Median
- 5.62
- Q1
- 2.84
- Min
- 0.33
With a P/S Ratio of 45.47, SOUN trades at a valuation that eclipses even the highest in the Software - Application industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
Price-to-Book Ratio
IBM
9.79
Information Technology Services Industry
- Max
- 11.78
- Q3
- 6.14
- Median
- 3.23
- Q1
- 1.97
- Min
- 0.42
The P/B Ratio is often not a primary valuation metric for the Information Technology Services industry.
SOUN
11.48
Software - Application Industry
- Max
- 21.03
- Q3
- 10.49
- Median
- 6.36
- Q1
- 2.89
- Min
- 0.12
The P/B Ratio is often not a primary valuation metric for the Software - Application industry.
Valuation at a Glance
| Symbol | IBM | SOUN |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 48.09 | -24.18 |
| Forward PEG Ratio (TTM) | 9.24 | 0.24 |
| Price-to-Sales Ratio (P/S, TTM) | 4.19 | 45.47 |
| Price-to-Book Ratio (P/B, TTM) | 9.79 | 11.48 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | 22.07 | -43.51 |
| EV-to-EBITDA (TTM) | 25.90 | -24.92 |
| EV-to-Sales (TTM) | 5.08 | 43.11 |