IBM vs MSFT: Which Is the Better Dividend Stock?
As of Oct 25, 2026, IBM (International Business Machines Corporation) screens as the stronger dividend stock, winning 5 of 8 head-to-head metrics. IBM offers the higher yield at 2.67%, MSFT has the higher dividend-safety score, and IBM looks like the better value (its fair-value estimate is 3% above its share price).
Key facts: IBM vs MSFT
Data as of · Source: SmarterDividends data
- As of Oct 25, 2026, International Business Machines Corporation (IBM) has the higher forward dividend yield at 2.67%, versus 0.75% for Microsoft Corporation (MSFT).
- As of Oct 25, 2026, SmarterDividends grades IBM's dividend safety A (91/100) and MSFT's A (97/100).
- By SmarterDividends' count as of Oct 25, 2026, IBM has raised its dividend for 30 consecutive years and MSFT for 20.
- As of Oct 25, 2026, IBM pays out 58% of its earnings as dividends and MSFT pays out 20%.
- As of Oct 25, 2026, IBM's fair-value estimate is 3% above its share price and MSFT's fair-value estimate is 41% below its share price, so IBM looks like the better value of the two on SmarterDividends' blended model.
Cite this page
SmarterDividends, "IBM vs MSFT: Dividend Yield, Safety & Value Compared," updated Oct 25, 2026, https://smarterdividends.com/compare/ibm-vs-msft
| Metric | IBM | MSFT |
|---|---|---|
| Forward yield | 2.67% | 0.75% |
| Annual dividend | $6.76 | $3.92 |
| Payout ratio | 58% | 20% |
| Years of growth | 30 yr | 20 yr |
| 5-yr dividend growth | 1.5% | 10.2% |
| 5-yr total return | 117% | 59% |
| Dividend safety score | 91 (A) | 97 (A) |
| Fair value estimate | $261.74 | $308.36 |
| Upside to fair value | +3% | -41% |
| Frequency | quarterly | quarterly |
| Market cap | $239.6B | $3.9T |
| P/E ratio | 21.6 | 29.2 |
Higher yield
IBM
2.67%
Safer dividend
MSFT
Grade A
Faster growth
MSFT
10.2%
Better value
IBM
+3% upside
IBM vs MSFT — FAQ
Is IBM or MSFT a better dividend stock?
On the data, IBM wins more head-to-head categories (5 vs 3). IBM offers the higher yield (2.67%), while MSFT has the stronger dividend-safety score. The right pick depends on whether you prioritise income, safety or value.
Which has a higher dividend yield, IBM or MSFT?
IBM has the higher forward dividend yield at 2.67%, versus 0.75% for MSFT.
Is IBM or MSFT safer?
MSFT has the higher dividend-safety score (97/100 vs 91/100), reflecting stronger payout coverage and dividend-growth history.
Is IBM or MSFT better value right now?
As of Oct 25, 2026, IBM looks like the better value: its fair-value estimate is 3% above its share price (fairly valued). For MSFT, its fair-value estimate is 41% below its share price.
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See more dividend stock comparisons · data refreshes daily · for informational purposes only, not investment advice.