I Bought My First IBM Shares Last Week

Just mentioned, I bought 20 shares of the big technology company IBM last week. It is my first position in IBM and I like to buy more shares of the company over the next decade if the sector performs well and the company still has a track record. Warren Buffett also bought a huge amount of IBM over the recent month. IBM shares represent roughly 19 percent of his total assets. I am not such an aggressive investor and I always like to have smaller positions but I would invest around 3-4 percent of my private wealth in IBM shares.

IBM is not a really cheap company. The P/E amounts to 13.82 and the forward P/E is 11.54. The company has around USD 12.3 billion of cash at 33.67 billion debt. The EV/EBITDA ratio amounts to 9! That’s fair but expensive in relation to other technology companies like Intel.

Technology is definitely one of the fields with the highest expected growth for the next years and IBM is one of the major players within the sector. IBM is something like an old economy stock in a new economy. Oracle and SAP are other wonderful growth picks I would buy but the current dividend yield is too low for me.

As of now, I have only three stocks within the sector. Beside IBM, I still own Intel and EBAY shares. There are many wonderful stocks but I hate the low yields and the fast changing business environment. This should be the price for the opportunity of fast growth. However, we will see how it ends…