ERICSSON LM-B SHS (1ERICB.MI) Stock Fundamental Analysis
Europe - BIT:1ERICB - SE0000108656 - Common Stock
7.91 EUR
+0.75 (+10.41%)
We assign a fundamental rating of 5 out of 10 to 1ERICB. 1ERICB was compared to 27 industry peers in the Communications Equipment industry. While 1ERICB has a great profitability rating, there are some minor concerns on its financial health. 1ERICB has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year 1ERICB was profitable.
In the past year 1ERICB had a positive cash flow from operations.
1ERICB had positive earnings in 4 of the past 5 years.
Each year in the past 5 years 1ERICB had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 0.58%, 1ERICB is doing good in the industry, outperforming 64.00% of the companies in the same industry.
1ERICB has a Return On Equity of 1.87%. This is in the better half of the industry: 1ERICB outperforms 64.00% of its industry peers.
The Return On Invested Capital of 1ERICB (13.71%) is better than 96.00% of its industry peers.
1ERICB had an Average Return On Invested Capital over the past 3 years of 10.05%. This is in line with the industry average of 11.62%.
The last Return On Invested Capital (13.71%) for 1ERICB is above the 3 year average (10.05%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.58% | ||
| ROE | 1.87% | ||
| ROIC | 13.71% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)10.05%
ROIC(5y)11.58%
1.3 Margins
The Profit Margin of 1ERICB (0.65%) is better than 64.00% of its industry peers.
In the last couple of years the Profit Margin of 1ERICB has declined.
The Operating Margin of 1ERICB (10.72%) is better than 80.00% of its industry peers.
1ERICB's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 46.21%, 1ERICB perfoms like the industry average, outperforming 56.00% of the companies in the same industry.
In the last couple of years the Gross Margin of 1ERICB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.72% | ||
| PM (TTM) | 0.65% | ||
| GM | 46.21% |
OM growth 3Y-12.66%
OM growth 5Y14.26%
PM growth 3Y-90.62%
PM growth 5Y-61.69%
GM growth 3Y1.11%
GM growth 5Y3.7%
2. Health
2.1 Basic Checks
1ERICB has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for 1ERICB remains at a similar level compared to 1 year ago.
1ERICB has more shares outstanding than it did 5 years ago.
1ERICB has a better debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of 1ERICB is 1.02, which is an excellent value as it means it would take 1ERICB, only 1.02 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of 1ERICB (1.02) is better than 92.00% of its industry peers.
A Debt/Equity ratio of 0.41 indicates that 1ERICB is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.41, 1ERICB is doing good in the industry, outperforming 64.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 1.02 | ||
| Altman-Z | N/A |
ROIC/WACC2.05
WACC6.69%
2.3 Liquidity
1ERICB has a Current Ratio of 1.09. This is a normal value and indicates that 1ERICB is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.09, 1ERICB is doing worse than 72.00% of the companies in the same industry.
1ERICB has a Quick Ratio of 1.09. This is a bad value and indicates that 1ERICB is not financially healthy enough and could expect problems in meeting its short term obligations.
1ERICB has a Quick ratio of 0.88. This is in the lower half of the industry: 1ERICB underperforms 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
1ERICB shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -46.92%.
The earnings per share for 1ERICB have been decreasing by -17.01% on average. This is quite bad
The Revenue has decreased by -1.79% in the past year.
Measured over the past years, 1ERICB shows a small growth in Revenue. The Revenue has been growing by 1.76% on average per year.
EPS 1Y (TTM)-46.92%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%60.24%
Revenue 1Y (TTM)-1.79%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%3.19%
3.2 Future
1ERICB is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 45.47% yearly.
1ERICB is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.82% yearly.
EPS Next Y267.53%
EPS Next 2Y93.12%
EPS Next 3Y58.42%
EPS Next 5Y45.47%
Revenue Next Year0.35%
Revenue Next 2Y0.68%
Revenue Next 3Y1.13%
Revenue Next 5Y-0.82%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 39.55, the valuation of 1ERICB can be described as expensive.
64.00% of the companies in the same industry are more expensive than 1ERICB, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.41. 1ERICB is valued slightly more expensive when compared to this.
A Price/Forward Earnings ratio of 13.50 indicates a correct valuation of 1ERICB.
1ERICB's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. 1ERICB is cheaper than 80.00% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.88. 1ERICB is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.55 | ||
| Fwd PE | 13.5 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1ERICB is valued a bit cheaper than 76.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, 1ERICB is valued cheaply inside the industry as 84.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.88 | ||
| EV/EBITDA | 7.35 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The decent profitability rating of 1ERICB may justify a higher PE ratio.
A more expensive valuation may be justified as 1ERICB's earnings are expected to grow with 58.42% in the coming years.
PEG (NY)0.15
PEG (5Y)N/A
EPS Next 2Y93.12%
EPS Next 3Y58.42%
5. Dividend
5.1 Amount
1ERICB has a Yearly Dividend Yield of 3.41%.
1ERICB's Dividend Yield is rather good when compared to the industry average which is at 6.04. 1ERICB pays more dividend than 88.00% of the companies in the same industry.
1ERICB's Dividend Yield is a higher than the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.41% |
5.2 History
On average, the dividend of 1ERICB grows each year by 22.02%, which is quite nice.
Dividend Growth(5Y)22.02%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
573.48% of the earnings are spent on dividend by 1ERICB. This is not a sustainable payout ratio.
1ERICB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP573.48%
EPS Next 2Y93.12%
EPS Next 3Y58.42%
BIT:1ERICB (5/21/2025, 7:00:00 PM)
7.91
+0.75 (+10.41%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners52.48%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap26.36B
Analysts57.24
Price Target7.72 (-2.4%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.41% |
Yearly Dividend0.25
Dividend Growth(5Y)22.02%
DP573.48%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)19.55%
Min EPS beat(2)-10.72%
Max EPS beat(2)49.81%
EPS beat(4)2
Avg EPS beat(4)-132.41%
Min EPS beat(4)-588.91%
Max EPS beat(4)49.81%
EPS beat(8)6
Avg EPS beat(8)-35.54%
EPS beat(12)7
Avg EPS beat(12)-21.49%
EPS beat(16)9
Avg EPS beat(16)-14.64%
Revenue beat(2)0
Avg Revenue beat(2)-1.28%
Min Revenue beat(2)-2.1%
Max Revenue beat(2)-0.45%
Revenue beat(4)1
Avg Revenue beat(4)-0.39%
Min Revenue beat(4)-2.1%
Max Revenue beat(4)1.67%
Revenue beat(8)1
Avg Revenue beat(8)-1.78%
Revenue beat(12)5
Avg Revenue beat(12)-0.75%
Revenue beat(16)7
Avg Revenue beat(16)-0.79%
PT rev (1m)-0.03%
PT rev (3m)2.57%
EPS NQ rev (1m)11.73%
EPS NQ rev (3m)30.94%
EPS NY rev (1m)0%
EPS NY rev (3m)-6.46%
Revenue NQ rev (1m)-0.37%
Revenue NQ rev (3m)-2.95%
Revenue NY rev (1m)-0.43%
Revenue NY rev (3m)-3.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.55 | ||
| Fwd PE | 13.5 | ||
| P/S | 1.15 | ||
| P/FCF | 6.88 | ||
| P/OCF | 6.29 | ||
| P/B | 3.33 | ||
| P/tB | 12.38 | ||
| EV/EBITDA | 7.35 |
EPS(TTM)0.2
EY2.53%
EPS(NY)0.59
Fwd EY7.41%
FCF(TTM)1.15
FCFY14.54%
OCF(TTM)1.26
OCFY15.89%
SpS6.89
BVpS2.37
TBVpS0.64
PEG (NY)0.15
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.58% | ||
| ROE | 1.87% | ||
| ROCE | 18.28% | ||
| ROIC | 13.71% | ||
| ROICexc | 20.76% | ||
| ROICexgc | 59.44% | ||
| OM | 10.72% | ||
| PM (TTM) | 0.65% | ||
| GM | 46.21% | ||
| FCFM | 16.7% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)10.05%
ROIC(5y)11.58%
ROICexc(3y)14.08%
ROICexc(5y)16.96%
ROICexgc(3y)44.7%
ROICexgc(5y)41.2%
ROCE(3y)13.4%
ROCE(5y)15.43%
ROICexcg growth 3Y9.12%
ROICexcg growth 5Y32.67%
ROICexc growth 3Y-8.84%
ROICexc growth 5Y16.91%
OM growth 3Y-12.66%
OM growth 5Y14.26%
PM growth 3Y-90.62%
PM growth 5Y-61.69%
GM growth 3Y1.11%
GM growth 5Y3.7%
F-Score7
Asset Turnover0.9
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 1.02 | ||
| Debt/EBITDA | 0.94 | ||
| Cap/Depr | 36.59% | ||
| Cap/Sales | 1.55% | ||
| Interest Coverage | 10.63 | ||
| Cash Conversion | 122.12% | ||
| Profit Quality | 2589.32% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z | N/A |
F-Score7
WACC6.69%
ROIC/WACC2.05
Cap/Depr(3y)47.04%
Cap/Depr(5y)51.35%
Cap/Sales(3y)1.94%
Cap/Sales(5y)2.02%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-46.92%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%60.24%
EPS Next Y267.53%
EPS Next 2Y93.12%
EPS Next 3Y58.42%
EPS Next 5Y45.47%
Revenue 1Y (TTM)-1.79%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%3.19%
Revenue Next Year0.35%
Revenue Next 2Y0.68%
Revenue Next 3Y1.13%
Revenue Next 5Y-0.82%
EBIT growth 1Y48.21%
EBIT growth 3Y-10.75%
EBIT growth 5Y16.26%
EBIT Next Year84.47%
EBIT Next 3Y23.21%
EBIT Next 5Y17.34%
FCF growth 1Y126.71%
FCF growth 3Y7.36%
FCF growth 5Y33.08%
OCF growth 1Y82.12%
OCF growth 3Y5.8%
OCF growth 5Y22.35%