Thursday, August 21, 2014

IBM: "Skim milk masquerades as cream."

I liberated these graphs from Dan Oliver of Myrmikan Capital.

IBM has clearly benefitted from Quantitative Easing by replacing expensive equity with cheap debt.

Over the past five years, IBM's stock has nearly double and its EPS have increased by 50%. But inside the numbers, it doesn't look very healthy. What happens when interest rates rise?


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