Long-Term Dividend Stability at IBM
IBM, the American technology company, is a prime example of a sustainable dividend policy in the IT sector. Since its founding in 1911, IBM has transformed from a manufacturer of electromechanical machines to an innovation leader in fields such as mainframes, artificial intelligence (AI), and cloud services.
IBM demonstrates exceptional resilience in its dividend payouts. Even during economically challenging times, such as the early 2000s, dividends were not cut but instead increased by 40 percent. This decision, funded through debt financing, underscores IBM’s strong commitment to stable earnings for its shareholders.
With a dividend yield of around 2.3 percent, nearly double the average of the American S&P 500 index, and a free cash flow of 11.9 billion USD in the last fiscal year, IBM remains an attractive investment for shareholders.
Technological Change as a Business Model
IBM’s success is closely tied to its ability for structural transformation. While other technology companies chase short-term trends, IBM focuses on long-term innovations in future technologies such as AI, cloud computing, and quantum computing. Particularly in the field of AI, IBM targets customers with high demands for data privacy and compliance.
By increasingly pursuing an open-source strategy, IBM can spread innovations globally, contributing to the stability of its earnings.
Relevance for Investors
With IBM’s long-standing dividend tradition and a focus on promising technologies, the company presents an attractive profile for investors. The combination of solid balance sheets and resilient earnings development makes IBM especially appealing to long-term oriented investors.
In summary, IBM demonstrates:
- Over a hundred years of technological innovation
- Stable or increasing dividends even in times of crisis
- A strategic focus on growth-oriented technologies
- An attractive dividend yield above the market average
These factors make IBM’s stock a potential “dividend for eternity.” Investors can benefit from stable income over long periods.