More on IBM. The following is a historical economic summary of IBM derived by my proprietary model. The larger the "True Value Added"
number, the better. Instead of my attempting to expain each number, I
invite you to ask questions.
Book Economic Profit 1988 1989 1990 1991 1992 1993 1994 1995 1996
Return on Invested Capital 1.8% 0.6% 2.7% -0.1% 1.1% 0.6% 1.8% 3.1% 3.2%
Weighted Average Cost of Capital 12.4% 11.9% 12.2% 11.9% 12.1% 10.7% 11.1% 11.1% 11.1%
Spread -10.62% -11.31% -9.42% -12.01% -10.95% -10.11% -9.28% -8.01% -7.86%
Invested Capital 107,158.0 123,462.0 119,459.0 132,166.0 132,664.0 122,631.0 107,225.0 101,949.0 99,211.0
NOPAAT 1,875.9 756.7 3,263.5 (138.2) 1,456.3 728.3 1,976.4 3,150.5 3,211.0
less Capital Charge 13,255.4 14,716.7 14,514.3 15,741.0 15,986.0 13,121.5 11,923.4 11,316.3 11,012.4
5 yr. CAGR
Book Economic Profit (11,379.6) (13,959.9) (11,250.8) (15,879.2) (14,529.7) (12,393.2) (9,947.0) (8,165.8) (7,801.5) Not Avalaible
% Growth (22.68%) 19.41% (41.14%) 8.50% 14.70% 19.74% 17.91% 4.46%
Divisor Base year
Standardized Book Economic Profit ($100.0) 100.0 (122.68) (98.9) (139.5) (127.7) (108.9) (87.4) (71.8) (68.6)
True Value Added (108,093.4) |
