ERICSSON LM-A SHS (ERCG.DE) Stock Fundamental Analysis
Europe • Frankfurt Stock Exchange • FRA:ERCG • SE0000108649
9.56 EUR
-0.17 (-1.75%)
Last: Feb 11, 2026, 07:00 PM
Overall ERCG gets a fundamental rating of 5 out of 10. We evaluated ERCG against 30 industry peers in the Communications Equipment industry. While ERCG has a great profitability rating, there are some minor concerns on its financial health. ERCG has a valuation in line with the averages, but on the other hand it scores bad on growth. Finally ERCG also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- ERCG had positive earnings in the past year.
- In the past year ERCG had a positive cash flow from operations.
- Of the past 5 years ERCG 4 years were profitable.
- ERCG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- ERCG has a Return On Assets of 10.18%. This is in the better half of the industry: ERCG outperforms 80.00% of its industry peers.
- Looking at the Return On Equity, with a value of 25.95%, ERCG belongs to the top of the industry, outperforming 90.00% of the companies in the same industry.
- ERCG has a better Return On Invested Capital (8.85%) than 70.00% of its industry peers.
| Industry Rank | Sector 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
1.3 Margins
- With an excellent Profit Margin value of 12.01%, ERCG belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
- ERCG's Profit Margin has improved in the last couple of years.
- ERCG has a better Operating Margin (14.08%) than 80.00% of its industry peers.
- ERCG's Operating Margin has improved in the last couple of years.
- ERCG has a Gross Margin (48.14%) which is in line with its industry peers.
- In the last couple of years the Gross Margin of ERCG has grown nicely.
| Industry Rank | Sector 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%
2. Health
2.1 Basic Checks
- ERCG has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- There is no outstanding debt for ERCG. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
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 has a Debt to FCF ratio of 1.38. This is in the better half of the industry: ERCG outperforms 76.67% of its industry peers.
- A Debt/Equity ratio of 0.32 indicates that ERCG is not too dependend on debt financing.
- With a Debt to Equity ratio value of 0.32, ERCG perfoms like the industry average, outperforming 53.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.38 | ||
| Altman-Z | N/A |
ROIC/WACC1.3
WACC6.82%
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.
- With a Current ratio value of 1.29, ERCG is not doing good in the industry: 73.33% of the companies in the same industry are doing better.
- 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 Quick ratio of 1.08. This is in the lower half of the industry: ERCG underperforms 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.08 |
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.
- ERCG shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.62% yearly.
- 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)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
- Based on estimates for the next years, ERCG will show a very negative growth in Earnings Per Share. The EPS will decrease by -11.72% on average per year.
- 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.
- 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
- ERCG is valuated reasonably with a Price/Earnings ratio of 10.99.
- Based on the Price/Earnings ratio, ERCG is valued cheaply inside the industry as 93.33% of the companies are valued more expensively.
- When comparing the Price/Earnings ratio of ERCG to the average of the S&P500 Index (28.18), we can say ERCG is valued rather cheaply.
- With a Price/Forward Earnings ratio of 15.06, ERCG is valued correctly.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ERCG indicates a rather cheap valuation: ERCG is cheaper than 86.67% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 28.01, ERCG is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.99 | ||
| Fwd PE | 15.06 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERCG indicates a rather cheap valuation: ERCG is cheaper than 86.67% of the companies listed in the same industry.
- Based on the Price/Free Cash Flow ratio, ERCG is valued a bit cheaper than the industry average as 76.67% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.53 | ||
| EV/EBITDA | 7.23 |
4.3 Compensation for Growth
- ERCG has a very decent profitability rating, which may justify a higher PE ratio.
- ERCG's earnings are expected to decrease with -11.16% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)1.14
EPS Next 2Y-12.81%
EPS Next 3Y-11.16%
5. Dividend
5.1 Amount
- ERCG has a Yearly Dividend Yield of 3.02%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.53, ERCG pays a better dividend. On top of this ERCG pays more dividend than 90.00% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.80, ERCG pays a better dividend.
| Industry Rank | Sector 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
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%
FRA:ERCG (2/11/2026, 7:00:00 PM)
9.56
-0.17 (-1.75%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)01-23 2026-01-23/bmo
Earnings (Next)04-17 2026-04-17
Inst Owners56.85%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap31.87B
Revenue(TTM)236.68B
Net Income(TTM)28.43B
Analysts56.43
Price Target8.7 (-9%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector 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 Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.99 | ||
| Fwd PE | 15.06 | ||
| P/S | 1.42 | ||
| P/FCF | 11.53 | ||
| P/OCF | 10.22 | ||
| P/B | 3.07 | ||
| P/tB | 6.33 | ||
| EV/EBITDA | 7.23 |
EPS(TTM)0.87
EY9.1%
EPS(NY)0.63
Fwd EY6.64%
FCF(TTM)0.83
FCFY8.67%
OCF(TTM)0.94
OCFY9.79%
SpS6.72
BVpS3.11
TBVpS1.51
PEG (NY)N/A
PEG (5Y)1.14
Graham Number7.8
Profitability
| Industry Rank | Sector 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 Rank | Sector 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
WACC6.82%
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 10.99 and the Price/Book (PB) ratio is 3.07.
How financially healthy is ERICSSON LM-A SHS?
The financial health rating of ERICSSON LM-A SHS (ERCG.DE) is 4 / 10.