IBM Dividend Hike Fails to Boost Free Cash Flow Amid Flat Quarter
IBM returned $3.2 billion to shareholders in dividends through the first half of 2026, despite flat free cash flow at $4.8 billion. CFO Jim Kavanaugh confirmed this on the Q2 earnings call.
The quarterly dividend increased to $1.69 as of June 30, 2026, up from $1.68. The payout ratio sat at 73.44% last quarter, down from 129.61% three months earlier.
TIKR's mid-case model puts a $340 target on IBM stock, realized by December 2030, for a 36% total return and an 8% annualized rate from today's $249 price.