TGM's two-stage DCF values International Business Machines Corporation (IBM) between $138.31 and $290.67 depending on assumptions, with a base case of $190.21. Growth is taken from the company's own record (blend of 5-year revenue and FCF growth (floored at 2%)), fading to 2.5% long-run; the discount rate (7.7%) reflects its beta.
What would today's price require?
$231.06 is justified only if free cash flow grows about +5.6% a year (fading to 2.5% long-run) at a 7.7% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 8.7% | $138.31 |
| Base case | 2.0%/yr | 7.7% | $190.21 |
| Optimistic | 5.0%/yr | 6.7% | $290.67 |
| Third-party model estimate (FMP) | independent reference · retrieved Sep 9, 2026 · assumptions not provided | $345.85 | |
The FMP figure is a third-party point estimate. Its cash-flow forecast, discount rate, terminal growth, and valuation date are not included in the stored response, so TGMCharts presents it only as a reference—not as an intrinsic-value conclusion or price target.
Current Price
$231.06
Market-Implied Growth
+5.6%/yr
vs -1.3% 5Y actual
Model Scenario Range
$138.31 – $290.67
model output — not a price target
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for IBM (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $11.9B · 0.94B shares · net debt $51.0B
Estimated Fair Value
$190.21
-17.7% vs $231.06
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $231.06; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.7% | $259 | $295 | $342 | $408 | $502 |
| 6.7% | $199 | $221 | $248 | $283 | $329 |
| 7.7% | $158 | $173 | $190 | $212 | $238 |
| 8.7% | $128 | $139 | $151 | $165 | $182 |
| 9.7% | $106 | $114 | $123 | $133 | $144 |
