IBM‘s CAPE ratio

The CAPE (Cyclically Adjusted Price-to-Earnings) ratio of IBM evaluates the company’s current valuation relative to its inflation-adjusted earnings over the past 10 years. In the context of the enterprise technology sector, this metric helps assess long-term financial stability amid cyclical shifts in IT spending, digital transformation, and AI adoption. A high CAPE ratio may suggest investor optimism about IBM’s strategic bets in hybrid cloud and AI platforms like watsonx. In contrast, a low CAPE ratio could imply market doubts about growth or competitive positioning in a rapidly evolving tech landscape.