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

FRA:ERCG • SE0000108649

Current stock price

9.72 EUR
-0.38 (-3.76%)
Last:

This ERCG.DE fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. ERCG.DE Profitability Analysis

1.1 Basic Checks

  • In the past year ERCG was profitable.
  • ERCG had a positive operating cash flow in the past year.
  • 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

  • With an excellent Return On Assets value of 10.18%, ERCG belongs to the best of the industry, outperforming 85.29% of the companies in the same industry.
  • Looking at the Return On Equity, with a value of 25.95%, ERCG belongs to the top of the industry, outperforming 88.24% of the companies in the same industry.
  • ERCG has a better Return On Invested Capital (8.85%) than 70.59% of its industry peers.
  • Measured over the past 3 years, the Average Return On Invested Capital for ERCG is below the industry average of 11.35%.
  • The 3 year average ROIC (6.69%) for ERCG is below the current ROIC(8.85%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 10.18%
ROE 25.95%
ROIC 8.85%
ROA(3y)0.43%
ROA(5y)2.81%
ROE(3y)-0.28%
ROE(5y)6.78%
ROIC(3y)6.69%
ROIC(5y)6.97%
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 82.35% of its industry peers.
  • In the last couple of years the Profit Margin of ERCG has grown nicely.
  • ERCG's Operating Margin of 14.08% is fine compared to the rest of the industry. ERCG outperforms 79.41% of its industry peers.
  • In the last couple of years the Operating Margin of ERCG has grown nicely.
  • ERCG's Gross Margin of 48.14% is fine compared to the rest of the industry. ERCG outperforms 61.76% of its industry peers.
  • 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 3Y7.54%
OM growth 5Y1.88%
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. ERCG.DE Health Analysis

2.1 Basic Checks

  • The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ERCG is still creating some value.
  • ERCG has about the same amout of shares outstanding than it did 1 year ago.
  • The number of shares outstanding for ERCG remains at a similar level compared to 5 years ago.
  • The debt/assets ratio for ERCG has been reduced compared to a year ago.
ERCG.DE Yearly Shares OutstandingERCG.DE Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 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 2025 100B 200B 300B

2.2 Solvency

  • The Debt to FCF ratio of ERCG is 1.38, which is an excellent value as it means it would take ERCG, only 1.38 years of fcf income to pay off all of its debts.
  • ERCG has a better Debt to FCF ratio (1.38) than 76.47% of its industry peers.
  • A Debt/Equity ratio of 0.32 indicates that ERCG is not too dependend on debt financing.
  • ERCG has a Debt to Equity ratio of 0.32. This is comparable to the rest of the industry: ERCG outperforms 47.06% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.32
Debt/FCF 1.38
Altman-Z N/A
ROIC/WACC1.56
WACC5.67%
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

  • A Current Ratio of 1.29 indicates that ERCG should not have too much problems paying its short term obligations.
  • ERCG has a worse Current ratio (1.29) than 61.76% of its industry peers.
  • 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 61.76% 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 2025 50B 100B 150B

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4

3. ERCG.DE Growth Analysis

3.1 Past

  • ERCG shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 320.74%, which is quite impressive.
  • The Earnings Per Share has been growing by 9.62% on average over the past years. This is quite good.
  • Looking at the last year, ERCG shows a decrease in Revenue. The Revenue has decreased by -4.52% in the last year.
  • Measured over the past years, ERCG shows a small growth in Revenue. The Revenue has been growing by 0.37% on average per year.
EPS 1Y (TTM)320.74%
EPS 3Y13.71%
EPS 5Y9.62%
EPS Q2Q%4.51%
Revenue 1Y (TTM)-4.52%
Revenue growth 3Y-4.48%
Revenue growth 5Y0.37%
Sales Q2Q%-10.35%

3.2 Future

  • The Earnings Per Share is expected to decrease by -8.08% on average over the next years.
  • The Revenue is expected to grow by 0.59% on average over the next years.
EPS Next Y-23.81%
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
EPS Next 5Y-8.08%
Revenue Next Year-1.71%
Revenue Next 2Y0.04%
Revenue Next 3Y0.91%
Revenue Next 5Y0.59%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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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7

4. ERCG.DE Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 11.30, which indicates a very decent valuation of ERCG.
  • Based on the Price/Earnings ratio, ERCG is valued cheaper than 97.06% of the companies in the same industry.
  • ERCG is valuated cheaply when we compare the Price/Earnings ratio to 27.95, which is the current average of the S&P500 Index.
  • The Price/Forward Earnings ratio is 13.98, which indicates a correct valuation of ERCG.
  • 94.12% of the companies in the same industry are more expensive than ERCG, based on the Price/Forward Earnings ratio.
  • When comparing the Price/Forward Earnings ratio of ERCG to the average of the S&P500 Index (38.68), we can say ERCG is valued rather cheaply.
Industry RankSector Rank
PE 11.3
Fwd PE 13.98
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 88.24% of the companies are valued more expensively.
  • Based on the Price/Free Cash Flow ratio, ERCG is valued cheaper than 82.35% of the companies in the same industry.
Industry RankSector Rank
P/FCF 12.13
EV/EBITDA 7.69
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 excellent profitability rating of ERCG may justify a higher PE ratio.
  • ERCG's earnings are expected to decrease with -4.80% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.17
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%

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6

5. ERCG.DE Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 2.72%, ERCG has a reasonable but not impressive dividend return.
  • ERCG's Dividend Yield is rather good when compared to the industry average which is at 2.24. ERCG pays more dividend than 91.18% of the companies in the same industry.
  • ERCG's Dividend Yield is a higher than the S&P500 average which is at 1.81.
Industry RankSector Rank
Dividend Yield 2.72%

5.2 History

  • On average, the dividend of ERCG grows each year by 13.68%, which is quite nice.
Dividend Growth(5Y)13.68%
Div Incr Years2
Div Non Decr Years7
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 33.41% of its income as dividend. This is a sustainable payout ratio.
DP33.41%
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
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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ERCG.DE Fundamentals: All Metrics, Ratios and Statistics

ERICSSON LM-A SHS

FRA:ERCG (4/17/2026, 7:00:00 PM)

9.72

-0.38 (-3.76%)

Chartmill FA Rating
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)04-17
Earnings (Next)07-14
Inst Owners58.35%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap32.77B
Revenue(TTM)236.68B
Net Income(TTM)28.43B
Analysts56.55
Price Target9.16 (-5.76%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 2.72%
Yearly Dividend0.26
Dividend Growth(5Y)13.68%
DP33.41%
Div Incr Years2
Div Non Decr Years7
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)4.48%
PT rev (3m)6.89%
EPS NQ rev (1m)0.28%
EPS NQ rev (3m)5.21%
EPS NY rev (1m)0.81%
EPS NY rev (3m)5.9%
Revenue NQ rev (1m)-0.12%
Revenue NQ rev (3m)0.01%
Revenue NY rev (1m)-0.2%
Revenue NY rev (3m)-1.33%
Valuation
Industry RankSector Rank
PE 11.3
Fwd PE 13.98
P/S 1.5
P/FCF 12.13
P/OCF 10.74
P/B 3.23
P/tB 6.66
EV/EBITDA 7.69
EPS(TTM)0.86
EY8.85%
EPS(NY)0.7
Fwd EY7.16%
FCF(TTM)0.8
FCFY8.24%
OCF(TTM)0.9
OCFY9.31%
SpS6.5
BVpS3.01
TBVpS1.46
PEG (NY)N/A
PEG (5Y)1.17
Graham Number7.62856 (-21.52%)
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)0.43%
ROA(5y)2.81%
ROE(3y)-0.28%
ROE(5y)6.78%
ROIC(3y)6.69%
ROIC(5y)6.97%
ROICexc(3y)9.88%
ROICexc(5y)10.27%
ROICexgc(3y)24.74%
ROICexgc(5y)25.68%
ROCE(3y)14.96%
ROCE(5y)15.6%
ROICexgc growth 3Y-6.32%
ROICexgc growth 5Y4.87%
ROICexc growth 3Y14.91%
ROICexc growth 5Y1.28%
OM growth 3Y7.54%
OM growth 5Y1.88%
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 0.83
Cap/Depr 42.29%
Cap/Sales 1.59%
Interest Coverage 15.11
Cash Conversion 78.04%
Profit Quality 102.67%
Current Ratio 1.29
Quick Ratio 1.08
Altman-Z N/A
F-Score7
WACC5.67%
ROIC/WACC1.56
Cap/Depr(3y)41.44%
Cap/Depr(5y)47.37%
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)320.74%
EPS 3Y13.71%
EPS 5Y9.62%
EPS Q2Q%4.51%
EPS Next Y-23.81%
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
EPS Next 5Y-8.08%
Revenue 1Y (TTM)-4.52%
Revenue growth 3Y-4.48%
Revenue growth 5Y0.37%
Sales Q2Q%-10.35%
Revenue Next Year-1.71%
Revenue Next 2Y0.04%
Revenue Next 3Y0.91%
Revenue Next 5Y0.59%
EBIT growth 1Y45.04%
EBIT growth 3Y2.72%
EBIT growth 5Y2.26%
EBIT Next Year7.58%
EBIT Next 3Y5.03%
EBIT Next 5Y2.67%
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 Fundamental Analysis FAQ

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

ChartMill assigns a fundamental rating of 6 / 10 to ERCG.DE.


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

ChartMill assigns a valuation rating of 7 / 10 to ERICSSON LM-A SHS (ERCG.DE). This can be considered as Undervalued.


How profitable is ERICSSON LM-A SHS (ERCG.DE) stock?

ERICSSON LM-A SHS (ERCG.DE) has a profitability rating of 8 / 10.


Can you provide the expected EPS growth for ERCG stock?

The Earnings per Share (EPS) of ERICSSON LM-A SHS (ERCG.DE) is expected to decline by -23.81% in the next year.


Can you provide the dividend sustainability for ERCG stock?

The dividend rating of ERICSSON LM-A SHS (ERCG.DE) is 6 / 10 and the dividend payout ratio is 33.41%.