ERICSSON LM-B SHS (ERCB.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:ERCB - SE0000108656 - Common Stock
8.172 EUR
-0.07 (-0.85%)
Taking everything into account, ERCB scores 6 out of 10 in our fundamental rating. ERCB was compared to 31 industry peers in the Communications Equipment industry. ERCB scores excellent on profitability, but there are some minor concerns on its financial health. ERCB scores decently on growth, while it is valued quite cheap. This could make an interesting combination. Finally ERCB also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year ERCB was profitable.
- ERCB had a positive operating cash flow in the past year.
- Of the past 5 years ERCB 4 years were profitable.
- In the past 5 years ERCB always reported a positive cash flow from operatings.
1.2 Ratios
- ERCB has a better Return On Assets (8.72%) than 87.50% of its industry peers.
- With an excellent Return On Equity value of 24.01%, ERCB belongs to the best of the industry, outperforming 93.75% of the companies in the same industry.
- With an excellent Return On Invested Capital value of 13.55%, ERCB belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for ERCB is in line with the industry average of 11.39%.
- The last Return On Invested Capital (13.55%) for ERCB is above the 3 year average (9.43%), which is a sign of increasing profitability.
| 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
- With an excellent Profit Margin value of 10.26%, ERCB belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
- ERCB's Profit Margin has declined in the last couple of years.
- With an excellent Operating Margin value of 12.97%, ERCB belongs to the best of the industry, outperforming 81.25% of the companies in the same industry.
- In the last couple of years the Operating Margin of ERCB has grown nicely.
- With a decent Gross Margin value of 47.62%, ERCB is doing good in the industry, outperforming 62.50% 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
- ERCB has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- Compared to 1 year ago, ERCB has about the same amount of shares outstanding.
- ERCB has more shares outstanding than it did 5 years ago.
- 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 has a better Debt to FCF ratio (1.45) than 81.25% 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.
- The Debt to Equity ratio of ERCB (0.35) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 1.45 | ||
| Altman-Z | N/A |
ROIC/WACC1.78
WACC7.62%
2.3 Liquidity
- ERCB has a Current Ratio of 1.17. This is a normal value and indicates that ERCB is financially healthy and should not expect problems in meeting its short term obligations.
- ERCB has a worse Current ratio (1.17) than 71.88% of its industry peers.
- A Quick Ratio of 0.94 indicates that ERCB may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.94, ERCB is doing worse than 65.63% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 541.12% over the past year.
- Measured over the past years, ERCB shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -17.01% on average per year.
- Looking at the last year, ERCB shows a decrease in Revenue. The Revenue has decreased by -2.65% in the last year.
- Measured over the past years, ERCB shows a small growth in Revenue. The Revenue has been growing by 1.76% on average per year.
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
- ERCB is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 29.52% yearly.
- The Revenue is expected to decrease by -1.48% on average over the next years.
EPS Next Y352.29%
EPS Next 2Y97.18%
EPS Next 3Y58.79%
EPS Next 5Y29.52%
Revenue Next Year-5.09%
Revenue Next 2Y-2.77%
Revenue Next 3Y-1.19%
Revenue Next 5Y-1.47%
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
- With a Price/Earnings ratio of 10.34, the valuation of ERCB can be described as very reasonable.
- 96.88% of the companies in the same industry are more expensive than ERCB, based on the Price/Earnings ratio.
- ERCB is valuated cheaply when we compare the Price/Earnings ratio to 27.38, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 13.19 indicates a correct valuation of ERCB.
- Based on the Price/Forward Earnings ratio, ERCB is valued cheaper than 87.50% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of ERCB to the average of the S&P500 Index (24.29), we can say ERCB is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.34 | ||
| Fwd PE | 13.19 |
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 93.75% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of ERCB indicates a rather cheap valuation: ERCB is cheaper than 81.25% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.6 | ||
| EV/EBITDA | 6.77 |
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 58.79% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.03
PEG (5Y)N/A
EPS Next 2Y97.18%
EPS Next 3Y58.79%
5. Dividend
5.1 Amount
- ERCB has a Yearly Dividend Yield of 3.23%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.52, ERCB pays a better dividend. On top of this ERCB pays more dividend than 93.75% of the companies listed in the same industry.
- ERCB's Dividend Yield is rather good when compared to the S&P500 average which is at 1.85.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.23% |
5.2 History
- The dividend of ERCB is nicely growing with an annual growth rate of 22.02%!
Dividend Growth(5Y)22.02%
Div Incr Years1
Div Non Decr Years6
5.3 Sustainability
- 37.84% of the earnings are spent on dividend by ERCB. This is a low number and sustainable payout ratio.
- ERCB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP37.84%
EPS Next 2Y97.18%
EPS Next 3Y58.79%
FRA:ERCB (1/16/2026, 7:00:00 PM)
8.172
-0.07 (-0.85%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)10-14 2025-10-14/bmo
Earnings (Next)01-23 2026-01-23/bmo
Inst Owners56.85%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap27.24B
Revenue(TTM)240.31B
Net Income(TTM)24.64B
Analysts56.43
Price Target8.27 (1.2%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.23% |
Yearly Dividend0.25
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)3.89%
PT rev (3m)16.28%
EPS NQ rev (1m)-2.91%
EPS NQ rev (3m)18.44%
EPS NY rev (1m)-0.21%
EPS NY rev (3m)21.62%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)-0.47%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-1.59%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.34 | ||
| Fwd PE | 13.19 | ||
| P/S | 1.22 | ||
| P/FCF | 9.6 | ||
| P/OCF | 8.6 | ||
| P/B | 2.84 | ||
| P/tB | 6.51 | ||
| EV/EBITDA | 6.77 |
EPS(TTM)0.79
EY9.67%
EPS(NY)0.62
Fwd EY7.58%
FCF(TTM)0.85
FCFY10.41%
OCF(TTM)0.95
OCFY11.63%
SpS6.73
BVpS2.87
TBVpS1.25
PEG (NY)0.03
PEG (5Y)N/A
Graham Number7.15
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
WACC7.62%
ROIC/WACC1.78
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 Y352.29%
EPS Next 2Y97.18%
EPS Next 3Y58.79%
EPS Next 5Y29.52%
Revenue 1Y (TTM)-2.65%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%-8.99%
Revenue Next Year-5.09%
Revenue Next 2Y-2.77%
Revenue Next 3Y-1.19%
Revenue Next 5Y-1.47%
EBIT growth 1Y54.66%
EBIT growth 3Y-10.75%
EBIT growth 5Y16.26%
EBIT Next Year112.01%
EBIT Next 3Y21.84%
EBIT Next 5Y14.41%
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 for ERCB stock?
ChartMill assigns a valuation rating of 9 / 10 to ERICSSON LM-B SHS (ERCB.DE). This can be considered as Undervalued.
What is the profitability of ERCB stock?
ERICSSON LM-B SHS (ERCB.DE) has a profitability rating of 8 / 10.
What is the valuation of ERICSSON LM-B SHS based on its PE and PB ratios?
The Price/Earnings (PE) ratio for ERICSSON LM-B SHS (ERCB.DE) is 10.34 and the Price/Book (PB) ratio is 2.84.
What is the financial health of ERICSSON LM-B SHS (ERCB.DE) stock?
The financial health rating of ERICSSON LM-B SHS (ERCB.DE) is 4 / 10.