Would You Still Hold International Business Machines Stock If It Fell Another 30%?

International Business Machines (IBM) stock is down 6.5% in a day. The recent slide reflects renewed concerns around its rich valuation and the software sector’s AI disruption, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?

Before judging its downturn reslience, let’s look at where International Business Machines stands today.

• Size: International Business Machines is a $275 Bil company with $65 Bil in revenue currently trading at $294.31.
• Fundamentals: Last 12 month revenue growth of 4.5% and operating margin of 17.7%.
• Liquidity: Has Debt to Equity ratio of 0.24 and Cash to Assets ratio of 0.1
• Valuation: International Business Machines stock is currently trading at P/E multiple of 34.8 and P/EBIT multiple of 24.2
• Has one instance since 2010 where it dipped >30% in < 30 days and subsequently returned 36.6% within a year. See IBM Dip Buy Analysis.

These metrics point to a Moderate operational performance, alongside Moderate valuation – making the stock Fairly Priced. For details, see Buy or Sell IBM Stock

That brings us to the key consideration for investors worried about this fall: how resilient is IBM stock if markets turn south? This is where our downturn resilience framework comes in. Suppose IBM stock falls another 20-30% to $206 – can investors comfortably hold on? Turns out, the stock saw an impact slightly worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.

2022 Inflation Shock

• IBM stock fell 20.2% from a high of $145.21 on 11 June 2021 to $115.81 on 26 November 2021 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 17 November 2022
• Since then, the stock increased to a high of $314.98 on 12 November 2025 , and currently trades at $294.31

 
2020 Covid Pandemic

• IBM stock fell 39.0% from a high of $149.08 on 12 February 2020 to $90.97 on 23 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 22 November 2022

 
2018 Correction

• IBM stock fell 40.9% from a high of $174.65 on 1 March 2017 to $103.26 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 25 January 2024

 
2008 Global Financial Crisis

• IBM stock fell 44.8% from a high of $124.79 on 22 July 2008 to $68.86 on 20 November 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 23 December 2009

 
Feeling jittery about IBM stock? Consider portfolio approach.

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