ERICSSON LM-B SHS (ERCB.DE) Stock Fundamental Analysis
Europe - FRA:ERCB - SE0000108656 - Common Stock
8.458 EUR
-0.14 (-1.67%)
Overall ERCB gets a fundamental rating of 6 out of 10. We evaluated ERCB against 28 industry peers in the Communications Equipment industry. While ERCB belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ERCB is valued quite cheap, while showing a decent growth score. This is a good combination! ERCB also has an excellent dividend rating. This makes ERCB very considerable for value and dividend investing!
1. Profitability
1.1 Basic Checks
In the past year ERCB was profitable.
In the past year ERCB had a positive cash flow from operations.
ERCB had positive earnings in 4 of the past 5 years.
Each year in the past 5 years ERCB had a positive operating cash flow.
1.2 Ratios
The Return On Assets of ERCB (8.72%) is better than 85.71% of its industry peers.
ERCB has a Return On Equity of 24.01%. This is amongst the best in the industry. ERCB outperforms 89.29% of its industry peers.
The Return On Invested Capital of ERCB (13.55%) is better than 89.29% of its industry peers.
ERCB had an Average Return On Invested Capital over the past 3 years of 9.43%. This is in line with the industry average of 10.02%.
The 3 year average ROIC (9.43%) for ERCB is below the current ROIC(13.55%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.72% | ||
| ROE | 24.01% | ||
| ROIC | 13.55% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)9.43%
ROIC(5y)10.87%
1.3 Margins
ERCB's Profit Margin of 10.26% is amongst the best of the industry. ERCB outperforms 89.29% of its industry peers.
In the last couple of years the Profit Margin of ERCB has declined.
With an excellent Operating Margin value of 12.97%, ERCB belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
ERCB's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 47.62%, ERCB is in the better half of the industry, outperforming 60.71% of the companies in the same industry.
In the last couple of years the Gross Margin of ERCB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.97% | ||
| PM (TTM) | 10.26% | ||
| GM | 47.62% |
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), ERCB is creating value.
Compared to 1 year ago, ERCB has about the same amount of shares outstanding.
Compared to 5 years ago, ERCB has more shares outstanding
Compared to 1 year ago, ERCB has an improved debt to assets ratio.
2.2 Solvency
ERCB has a debt to FCF ratio of 1.45. This is a very positive value and a sign of high solvency as it would only need 1.45 years to pay back of all of its debts.
ERCB's Debt to FCF ratio of 1.45 is amongst the best of the industry. ERCB outperforms 85.71% of its industry peers.
ERCB has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
ERCB has a better Debt to Equity ratio (0.35) than 60.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 1.45 | ||
| Altman-Z | N/A |
ROIC/WACC2.17
WACC6.25%
2.3 Liquidity
A Current Ratio of 1.17 indicates that ERCB should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.17, ERCB is doing worse than 78.57% of the companies in the same industry.
ERCB has a Quick Ratio of 1.17. This is a bad value and indicates that ERCB is not financially healthy enough and could expect problems in meeting its short term obligations.
ERCB's Quick ratio of 0.94 is on the low side compared to the rest of the industry. ERCB is outperformed by 67.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
ERCB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 541.12%, which is quite impressive.
ERCB shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -17.01% yearly.
The Revenue has decreased by -2.65% in the past year.
ERCB shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.76% yearly.
EPS 1Y (TTM)541.12%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%113.66%
Revenue 1Y (TTM)-2.65%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%-8.99%
3.2 Future
Based on estimates for the next years, ERCB will show a very strong growth in Earnings Per Share. The EPS will grow by 30.26% on average per year.
Based on estimates for the next years, ERCB will show a decrease in Revenue. The Revenue will decrease by -0.91% on average per year.
EPS Next Y348.24%
EPS Next 2Y96.63%
EPS Next 3Y59.26%
EPS Next 5Y30.26%
Revenue Next Year-4.89%
Revenue Next 2Y-2.58%
Revenue Next 3Y-1.15%
Revenue Next 5Y-0.91%
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
ERCB is valuated reasonably with a Price/Earnings ratio of 10.98.
96.43% of the companies in the same industry are more expensive than ERCB, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 25.89, ERCB is valued rather cheaply.
ERCB is valuated correctly with a Price/Forward Earnings ratio of 14.01.
Based on the Price/Forward Earnings ratio, ERCB is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.59, ERCB is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.98 | ||
| Fwd PE | 14.01 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERCB indicates a rather cheap valuation: ERCB is cheaper than 85.71% of the companies listed in the same industry.
75.00% of the companies in the same industry are more expensive than ERCB, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.15 | ||
| EV/EBITDA | 7.31 |
4.3 Compensation for Growth
ERCB's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ERCB has an outstanding profitability rating, which may justify a higher PE ratio.
ERCB's earnings are expected to grow with 59.26% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.03
PEG (5Y)N/A
EPS Next 2Y96.63%
EPS Next 3Y59.26%
5. Dividend
5.1 Amount
ERCB has a Yearly Dividend Yield of 3.03%.
ERCB's Dividend Yield is rather good when compared to the industry average which is at 5.41. ERCB pays more dividend than 92.86% of the companies in the same industry.
ERCB's Dividend Yield is a higher than the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.03% |
5.2 History
On average, the dividend of ERCB grows each year by 22.02%, which is quite nice.
Dividend Growth(5Y)22.02%
Div Incr Years1
Div Non Decr Years6
5.3 Sustainability
ERCB pays out 37.84% of its income as dividend. This is a sustainable payout ratio.
ERCB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.84%
EPS Next 2Y96.63%
EPS Next 3Y59.26%
FRA:ERCB (11/14/2025, 7:00:00 PM)
8.458
-0.14 (-1.67%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners54.97%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap28.19B
Revenue(TTM)240.31B
Net Income(TTM)24.64B
Analysts56.55
Price Target7.91 (-6.48%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.03% |
Yearly Dividend0.24
Dividend Growth(5Y)22.02%
DP37.84%
Div Incr Years1
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)49.11%
Min EPS beat(2)20.62%
Max EPS beat(2)77.6%
EPS beat(4)3
Avg EPS beat(4)34.33%
Min EPS beat(4)-10.72%
Max EPS beat(4)77.6%
EPS beat(8)6
Avg EPS beat(8)-29.88%
EPS beat(12)9
Avg EPS beat(12)-11.71%
EPS beat(16)10
Avg EPS beat(16)-8.77%
Revenue beat(2)0
Avg Revenue beat(2)-3.63%
Min Revenue beat(2)-6.39%
Max Revenue beat(2)-0.88%
Revenue beat(4)0
Avg Revenue beat(4)-2.46%
Min Revenue beat(4)-6.39%
Max Revenue beat(4)-0.45%
Revenue beat(8)1
Avg Revenue beat(8)-2.31%
Revenue beat(12)3
Avg Revenue beat(12)-1.5%
Revenue beat(16)7
Avg Revenue beat(16)-0.68%
PT rev (1m)11.18%
PT rev (3m)10.58%
EPS NQ rev (1m)14.08%
EPS NQ rev (3m)14.08%
EPS NY rev (1m)20.53%
EPS NY rev (3m)21.96%
Revenue NQ rev (1m)-0.17%
Revenue NQ rev (3m)-0.47%
Revenue NY rev (1m)-1.38%
Revenue NY rev (3m)-1.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.98 | ||
| Fwd PE | 14.01 | ||
| P/S | 1.28 | ||
| P/FCF | 10.15 | ||
| P/OCF | 9.08 | ||
| P/B | 3 | ||
| P/tB | 6.88 | ||
| EV/EBITDA | 7.31 |
EPS(TTM)0.77
EY9.1%
EPS(NY)0.6
Fwd EY7.14%
FCF(TTM)0.83
FCFY9.86%
OCF(TTM)0.93
OCFY11.01%
SpS6.59
BVpS2.82
TBVpS1.23
PEG (NY)0.03
PEG (5Y)N/A
Graham Number6.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.72% | ||
| ROE | 24.01% | ||
| ROCE | 19.24% | ||
| ROIC | 13.55% | ||
| ROICexc | 19.78% | ||
| ROICexgc | 41.31% | ||
| OM | 12.97% | ||
| PM (TTM) | 10.26% | ||
| GM | 47.62% | ||
| FCFM | 12.65% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)9.43%
ROIC(5y)10.87%
ROICexc(3y)13.21%
ROICexc(5y)15.92%
ROICexgc(3y)41.96%
ROICexgc(5y)38.68%
ROCE(3y)13.4%
ROCE(5y)15.43%
ROICexgc growth 3Y9.12%
ROICexgc growth 5Y7.91%
ROICexc growth 3Y-8.84%
ROICexc growth 5Y4.9%
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-Score6
Asset Turnover0.85
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 1.45 | ||
| Debt/EBITDA | 0.87 | ||
| Cap/Depr | 36.83% | ||
| Cap/Sales | 1.48% | ||
| Interest Coverage | 13.31 | ||
| Cash Conversion | 83.18% | ||
| Profit Quality | 123.37% | ||
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | N/A |
F-Score6
WACC6.25%
ROIC/WACC2.17
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)541.12%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%113.66%
EPS Next Y348.24%
EPS Next 2Y96.63%
EPS Next 3Y59.26%
EPS Next 5Y30.26%
Revenue 1Y (TTM)-2.65%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%-8.99%
Revenue Next Year-4.89%
Revenue Next 2Y-2.58%
Revenue Next 3Y-1.15%
Revenue Next 5Y-0.91%
EBIT growth 1Y54.66%
EBIT growth 3Y-10.75%
EBIT growth 5Y16.26%
EBIT Next Year81.48%
EBIT Next 3Y20.93%
EBIT Next 5Y15.06%
FCF growth 1Y392.6%
FCF growth 3Y7.36%
FCF growth 5Y33.08%
OCF growth 1Y169.74%
OCF growth 3Y5.8%
OCF growth 5Y22.35%
ERICSSON LM-B SHS / ERCB.DE FAQ
Can you provide the ChartMill fundamental rating for ERICSSON LM-B SHS?
ChartMill assigns a fundamental rating of 6 / 10 to ERCB.DE.
What is the valuation status of ERICSSON LM-B SHS (ERCB.DE) stock?
ChartMill assigns a valuation rating of 9 / 10 to ERICSSON LM-B SHS (ERCB.DE). This can be considered as Undervalued.
How profitable is ERICSSON LM-B SHS (ERCB.DE) stock?
ERICSSON LM-B SHS (ERCB.DE) has a profitability rating of 8 / 10.
Can you provide the financial health for ERCB stock?
The financial health rating of ERICSSON LM-B SHS (ERCB.DE) is 5 / 10.
What is the expected EPS growth for ERICSSON LM-B SHS (ERCB.DE) stock?
The Earnings per Share (EPS) of ERICSSON LM-B SHS (ERCB.DE) is expected to grow by 348.24% in the next year.