ERICSSON LM-A SHS (ERCG.DE) Stock Fundamental Analysis

Europe • Frankfurt Stock Exchange • FRA:ERCG • SE0000108649

9.43 EUR
+0.04 (+0.43%)
Last: Feb 6, 2026, 07:00 PM
Overview Stock Chart Technical Analysis Fundamental Analysis Analyst Ratings Earnings Estimates Financials Ownership
Fundamental Rating

5

Taking everything into account, ERCG scores 5 out of 10 in our fundamental rating. ERCG was compared to 30 industry peers in the Communications Equipment industry. While ERCG belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ERCG is valued correctly, but it does not seem to be growing. Finally ERCG also has an excellent dividend rating.


Dividend Valuation Growth Profitability Health

7

1. Profitability

1.1 Basic Checks

  • In the past year ERCG was profitable.
  • In the past year ERCG had a positive cash flow from operations.
  • Of the past 5 years ERCG 4 years were profitable.
  • In the past 5 years ERCG always reported a positive cash flow from operatings.
ERCG.DE Yearly Net Income VS EBIT VS OCF VS FCFERCG.DE Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20B -20B 40B

1.2 Ratios

  • The Return On Assets of ERCG (10.18%) is better than 78.13% of its industry peers.
  • The Return On Equity of ERCG (25.95%) is better than 87.50% of its industry peers.
  • ERCG has a better Return On Invested Capital (8.85%) than 68.75% of its industry peers.
Industry RankSector Rank
ROA 10.18%
ROE 25.95%
ROIC 8.85%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ERCG.DE Yearly ROA, ROE, ROICERCG.DE Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10 -10 20 -20 -30

1.3 Margins

  • ERCG has a better Profit Margin (12.01%) than 81.25% of its industry peers.
  • ERCG's Profit Margin has improved in the last couple of years.
  • ERCG's Operating Margin of 14.08% is fine compared to the rest of the industry. ERCG outperforms 78.13% of its industry peers.
  • In the last couple of years the Operating Margin of ERCG has grown nicely.
  • The Gross Margin of ERCG (48.14%) is comparable to the rest of the industry.
  • ERCG's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 14.08%
PM (TTM) 12.01%
GM 48.14%
OM growth 3Y7.92%
OM growth 5Y2.1%
PM growth 3Y20.32%
PM growth 5Y9.81%
GM growth 3Y4.83%
GM growth 5Y3.45%
ERCG.DE Yearly Profit, Operating, Gross MarginsERCG.DE Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20 40

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4

2. Health

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ERCG is creating some value.
  • ERCG has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
ERCG.DE Yearly Shares OutstandingERCG.DE Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B
ERCG.DE Yearly Total Debt VS Total AssetsERCG.DE Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 100B 200B 300B

2.2 Solvency

  • ERCG has a debt to FCF ratio of 1.38. This is a very positive value and a sign of high solvency as it would only need 1.38 years to pay back of all of its debts.
  • ERCG's Debt to FCF ratio of 1.38 is fine compared to the rest of the industry. ERCG outperforms 75.00% of its industry peers.
  • A Debt/Equity ratio of 0.32 indicates that ERCG is not too dependend on debt financing.
  • Looking at the Debt to Equity ratio, with a value of 0.32, ERCG is in line with its industry, outperforming 46.88% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.32
Debt/FCF 1.38
Altman-Z N/A
ROIC/WACC1.3
WACC6.81%
ERCG.DE Yearly LT Debt VS Equity VS FCFERCG.DE Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20B 40B 60B 80B 100B

2.3 Liquidity

  • ERCG has a Current Ratio of 1.29. This is a normal value and indicates that ERCG is financially healthy and should not expect problems in meeting its short term obligations.
  • Looking at the Current ratio, with a value of 1.29, ERCG is doing worse than 75.00% of the companies in the same industry.
  • ERCG has a Quick Ratio of 1.08. This is a normal value and indicates that ERCG is financially healthy and should not expect problems in meeting its short term obligations.
  • ERCG has a worse Quick ratio (1.08) than 68.75% of its industry peers.
Industry RankSector Rank
Current Ratio 1.29
Quick Ratio 1.08
ERCG.DE Yearly Current Assets VS Current LiabilitesERCG.DE Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 50B 100B 150B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

3

3. Growth

3.1 Past

  • ERCG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 440.40%, which is quite impressive.
  • The Earnings Per Share has been growing by 9.62% on average over the past years. This is quite good.
  • ERCG shows a decrease in Revenue. In the last year, the revenue decreased by -4.52%.
  • ERCG shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.37% yearly.
EPS 1Y (TTM)440.4%
EPS 3Y13.71%
EPS 5Y9.62%
EPS Q2Q%36.79%
Revenue 1Y (TTM)-4.52%
Revenue growth 3Y-4.48%
Revenue growth 5Y0.37%
Sales Q2Q%-4.98%

3.2 Future

  • The Earnings Per Share is expected to decrease by -11.72% on average over the next years. This is quite bad
  • ERCG is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.79% yearly.
EPS Next Y-27.33%
EPS Next 2Y-12.81%
EPS Next 3Y-11.16%
EPS Next 5Y-11.72%
Revenue Next Year-0.39%
Revenue Next 2Y0.82%
Revenue Next 3Y0.13%
Revenue Next 5Y-0.79%

3.3 Evolution

  • The EPS growth rate is decreasing: in the next years the growth will be less 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.
ERCG.DE Yearly Revenue VS EstimatesERCG.DE Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 50B 100B 150B 200B 250B
ERCG.DE Yearly EPS VS EstimatesERCG.DE Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 2 -2 4 6 8

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6

4. Valuation

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 10.97, the valuation of ERCG can be described as reasonable.
  • Based on the Price/Earnings ratio, ERCG is valued cheaper than 90.63% of the companies in the same industry.
  • The average S&P500 Price/Earnings ratio is at 27.93. ERCG is valued rather cheaply when compared to this.
  • The Price/Forward Earnings ratio is 15.01, which indicates a correct valuation of ERCG.
  • Based on the Price/Forward Earnings ratio, ERCG is valued cheaply inside the industry as 87.50% of the companies are valued more expensively.
  • ERCG's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.77.
Industry RankSector Rank
PE 10.97
Fwd PE 15.01
ERCG.DE Price Earnings VS Forward Price EarningsERCG.DE Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, ERCG is valued cheaply inside the industry as 84.38% of the companies are valued more expensively.
  • ERCG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ERCG is cheaper than 75.00% of the companies in the same industry.
Industry RankSector Rank
P/FCF 11.5
EV/EBITDA 7.2
ERCG.DE Per share dataERCG.DE EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6

4.3 Compensation for Growth

  • The decent profitability rating of ERCG may justify a higher PE ratio.
  • A cheap valuation may be justified as ERCG's earnings are expected to decrease with -11.16% in the coming years.
PEG (NY)N/A
PEG (5Y)1.14
EPS Next 2Y-12.81%
EPS Next 3Y-11.16%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

7

5. Dividend

5.1 Amount

  • With a Yearly Dividend Yield of 3.02%, ERCG has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 2.53, ERCG pays a better dividend. On top of this ERCG pays more dividend than 87.50% of the companies listed in the same industry.
  • ERCG's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
Industry RankSector Rank
Dividend Yield 3.02%

5.2 History

  • The dividend of ERCG is nicely growing with an annual growth rate of 22.02%!
Dividend Growth(5Y)22.02%
Div Incr Years1
Div Non Decr Years6
ERCG.DE Yearly Dividends per shareERCG.DE Yearly Dividends per shareYearly Dividends per share 2019 2020 2021 2022 2023 2024 2025 2026 0.5 1 1.5 2 2.5

5.3 Sustainability

  • ERCG pays out 33.58% of its income as dividend. This is a sustainable payout ratio.
DP33.58%
EPS Next 2Y-12.81%
EPS Next 3Y-11.16%
ERCG.DE Yearly Income VS Free CF VS DividendERCG.DE Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 20B -20B 40B
ERCG.DE Dividend Payout.ERCG.DE Dividend Payout, showing the Payout Ratio.ERCG.DE Dividend Payout.PayoutRetained Earnings

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ERICSSON LM-A SHS

FRA:ERCG (2/6/2026, 7:00:00 PM)

9.43

+0.04 (+0.43%)

Chartmill FA Rating
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)01-23
Earnings (Next)04-17
Inst Owners56.85%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap31.43B
Revenue(TTM)236.68B
Net Income(TTM)28.43B
Analysts56.43
Price Target8.7 (-7.74%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 3.02%
Yearly Dividend0.25
Dividend Growth(5Y)22.02%
DP33.58%
Div Incr Years1
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)53.68%
Min EPS beat(2)29.76%
Max EPS beat(2)77.6%
EPS beat(4)4
Avg EPS beat(4)44.45%
Min EPS beat(4)20.62%
Max EPS beat(4)77.6%
EPS beat(8)6
Avg EPS beat(8)-30.16%
EPS beat(12)10
Avg EPS beat(12)-8.61%
EPS beat(16)10
Avg EPS beat(16)-9.98%
Revenue beat(2)1
Avg Revenue beat(2)1.05%
Min Revenue beat(2)-0.88%
Max Revenue beat(2)2.98%
Revenue beat(4)1
Avg Revenue beat(4)-1.6%
Min Revenue beat(4)-6.39%
Max Revenue beat(4)2.98%
Revenue beat(8)2
Avg Revenue beat(8)-1.04%
Revenue beat(12)3
Avg Revenue beat(12)-1.34%
Revenue beat(16)7
Avg Revenue beat(16)-0.7%
PT rev (1m)7.24%
PT rev (3m)9.25%
EPS NQ rev (1m)5.08%
EPS NQ rev (3m)2.87%
EPS NY rev (1m)1.01%
EPS NY rev (3m)1.58%
Revenue NQ rev (1m)0.13%
Revenue NQ rev (3m)-0.6%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.38%
Valuation
Industry RankSector Rank
PE 10.97
Fwd PE 15.01
P/S 1.42
P/FCF 11.5
P/OCF 10.18
P/B 3.06
P/tB 6.31
EV/EBITDA 7.2
EPS(TTM)0.86
EY9.12%
EPS(NY)0.63
Fwd EY6.66%
FCF(TTM)0.82
FCFY8.7%
OCF(TTM)0.93
OCFY9.82%
SpS6.65
BVpS3.08
TBVpS1.49
PEG (NY)N/A
PEG (5Y)1.14
Graham Number7.72
Profitability
Industry RankSector Rank
ROA 10.18%
ROE 25.95%
ROCE 19.8%
ROIC 8.85%
ROICexc 13.34%
ROICexgc 26.95%
OM 14.08%
PM (TTM) 12.01%
GM 48.14%
FCFM 12.33%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y7.92%
OM growth 5Y2.1%
PM growth 3Y20.32%
PM growth 5Y9.81%
GM growth 3Y4.83%
GM growth 5Y3.45%
F-Score7
Asset Turnover0.85
Health
Industry RankSector Rank
Debt/Equity 0.32
Debt/FCF 1.38
Debt/EBITDA 0.82
Cap/Depr 40.77%
Cap/Sales 1.59%
Interest Coverage 15.11
Cash Conversion 77.43%
Profit Quality 102.67%
Current Ratio 1.29
Quick Ratio 1.08
Altman-Z N/A
F-Score7
WACC6.81%
ROIC/WACC1.3
Cap/Depr(3y)40.93%
Cap/Depr(5y)47.07%
Cap/Sales(3y)1.71%
Cap/Sales(5y)1.88%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)440.4%
EPS 3Y13.71%
EPS 5Y9.62%
EPS Q2Q%36.79%
EPS Next Y-27.33%
EPS Next 2Y-12.81%
EPS Next 3Y-11.16%
EPS Next 5Y-11.72%
Revenue 1Y (TTM)-4.52%
Revenue growth 3Y-4.48%
Revenue growth 5Y0.37%
Sales Q2Q%-4.98%
Revenue Next Year-0.39%
Revenue Next 2Y0.82%
Revenue Next 3Y0.13%
Revenue Next 5Y-0.79%
EBIT growth 1Y45.04%
EBIT growth 3Y3.08%
EBIT growth 5Y2.47%
EBIT Next Year7.3%
EBIT Next 3Y6.82%
EBIT Next 5Y-0.23%
FCF growth 1Y-31.52%
FCF growth 3Y5.77%
FCF growth 5Y4.32%
OCF growth 1Y-28.77%
OCF growth 3Y2.21%
OCF growth 5Y2.64%

ERICSSON LM-A SHS / ERCG.DE FAQ

Can you provide the ChartMill fundamental rating for ERICSSON LM-A SHS?

ChartMill assigns a fundamental rating of 5 / 10 to ERCG.DE.


What is the valuation status of ERICSSON LM-A SHS (ERCG.DE) stock?

ChartMill assigns a valuation rating of 6 / 10 to ERICSSON LM-A SHS (ERCG.DE). This can be considered as Fairly Valued.


What is the profitability of ERCG stock?

ERICSSON LM-A SHS (ERCG.DE) has a profitability rating of 7 / 10.


What are the PE and PB ratios of ERICSSON LM-A SHS (ERCG.DE) stock?

The Price/Earnings (PE) ratio for ERICSSON LM-A SHS (ERCG.DE) is 10.97 and the Price/Book (PB) ratio is 3.06.


How financially healthy is ERICSSON LM-A SHS?

The financial health rating of ERICSSON LM-A SHS (ERCG.DE) is 4 / 10.