ERICSSON LM-B SHS (1ERICB.MI) Stock Fundamental Analysis
BIT:1ERICB - Euronext Milan - SE0000108656 - Common Stock - Currency: EUR
1ERICB gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 25 industry peers in the Communications Equipment industry. 1ERICB scores excellent on profitability, but there are some minor concerns on its financial health. 1ERICB is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
1ERICB had positive earnings in the past year.
1ERICB had a positive operating cash flow in the past year.
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
The Return On Assets of 1ERICB (0.58%) is better than 64.00% of its industry peers.
1ERICB has a better Return On Equity (1.87%) than 64.00% of its industry peers.
1ERICB has a better Return On Invested Capital (13.71%) than 96.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1ERICB is in line with the industry average of 9.99%.
The 3 year average ROIC (10.05%) for 1ERICB is below the current ROIC(13.71%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 0.65%, 1ERICB is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
1ERICB's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 10.72%, 1ERICB is doing good in the industry, outperforming 80.00% of the companies in the same industry.
In the last couple of years the Operating Margin of 1ERICB has grown nicely.
1ERICB has a Gross Margin (46.21%) which is comparable to the rest of the 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 1ERICB is creating value.
Compared to 1 year ago, 1ERICB has about the same amount of shares outstanding.
The number of shares outstanding for 1ERICB has been increased compared to 5 years ago.
The debt/assets ratio for 1ERICB has been reduced compared to a year ago.
2.2 Solvency
1ERICB has a debt to FCF ratio of 1.02. This is a very positive value and a sign of high solvency as it would only need 1.02 years to pay back of 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.
1ERICB has a better Debt to Equity ratio (0.41) than 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 1.02 | ||
| Altman-Z | N/A |
ROIC/WACC2.05
WACC6.69%
2.3 Liquidity
A Current Ratio of 1.09 indicates that 1ERICB should not have too much problems paying its short term obligations.
The Current ratio of 1ERICB (1.09) is worse than 72.00% of its industry peers.
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.
Looking at the Quick ratio, with a value of 0.88, 1ERICB is doing worse than 60.00% of the companies in the same industry.
| 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%.
1ERICB shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -17.01% yearly.
1ERICB shows a decrease in Revenue. In the last year, the revenue decreased by -1.79%.
1ERICB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.76% yearly.
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
The Earnings Per Share is expected to grow by 45.47% on average over the next years. This is a very strong growth
The Revenue is expected to decrease by -0.82% on average over the next years.
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 39.55, 1ERICB can be considered very expensive at the moment.
Based on the Price/Earnings ratio, 1ERICB is valued a bit cheaper than the industry average as 64.00% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of 1ERICB to the average of the S&P500 Index (27.30), we can say 1ERICB is valued slightly more expensively.
The Price/Forward Earnings ratio is 13.50, which 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.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, 1ERICB is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.55 | ||
| Fwd PE | 13.5 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1ERICB indicates a somewhat cheap valuation: 1ERICB is cheaper than 76.00% of the companies listed 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
1ERICB's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
1ERICB has a very decent profitability rating, which may justify a higher PE ratio.
1ERICB's earnings are expected to grow with 58.42% in the coming years. This may justify a more expensive valuation.
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%. Purely for dividend investing, there may be better candidates out there.
1ERICB's Dividend Yield is rather good when compared to the industry average which is at 5.86. 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 2.35.
| 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%