ERICSSON LM-A SHS (ERCG.DE) Fundamental Analysis & Valuation
FRA:ERCG • SE0000108649
Current stock price
10.44 EUR
+0.3 (+2.96%)
Last:
This ERCG.DE fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.
1. ERCG.DE Profitability Analysis
1.1 Basic Checks
- ERCG had positive earnings in the past year.
- ERCG had a positive operating cash flow in the past year.
- 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
- Looking at the Return On Assets, with a value of 10.18%, ERCG belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
- With an excellent Return On Equity value of 25.95%, ERCG belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 8.85%, ERCG is in the better half of the industry, outperforming 68.75% of the companies in the same industry.
- ERCG had an Average Return On Invested Capital over the past 3 years of 6.69%. This is below the industry average of 11.16%.
- The 3 year average ROIC (6.69%) for ERCG is below the current ROIC(8.85%), indicating increased profibility in the last year.
| Industry Rank | Sector 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%
1.3 Margins
- ERCG's Profit Margin of 12.01% is fine compared to the rest of the industry. ERCG outperforms 78.13% of its industry peers.
- ERCG's Profit Margin has improved in the last couple of years.
- With a decent Operating Margin value of 14.08%, ERCG is doing good in the industry, outperforming 75.00% of the companies in the same industry.
- In the last couple of years the Operating Margin of ERCG has grown nicely.
- ERCG has a Gross Margin (48.14%) which is comparable to the rest of the industry.
- ERCG's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector 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%
2. ERCG.DE Health Analysis
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 about the same amout of shares outstanding than it did 1 year ago.
- ERCG has about the same amout of shares outstanding than it did 5 years ago.
- ERCG has a better debt/assets ratio than last year.
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 better Debt to FCF ratio (1.38) than 78.13% 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 (0.32) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.32 | ||
| Debt/FCF | 1.38 | ||
| Altman-Z | N/A |
ROIC/WACC1.52
WACC5.84%
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.
- ERCG has a worse Current ratio (1.29) than 65.63% 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.
- With a Quick ratio value of 1.08, ERCG is not doing good in the industry: 65.63% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.08 |
3. ERCG.DE Growth Analysis
3.1 Past
- The Earnings Per Share has grown by an impressive 440.40% over the past year.
- 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
- The Earnings Per Share is expected to decrease by -8.08% on average over the next years.
- Based on estimates for the next years, ERCG will show a small growth in Revenue. The Revenue will grow by 0.59% on average per year.
EPS Next Y-23.81%
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
EPS Next 5Y-8.08%
Revenue Next Year-1.63%
Revenue Next 2Y0.03%
Revenue Next 3Y0.89%
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.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. ERCG.DE Valuation Analysis
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 12.28, the valuation of ERCG can be described as correct.
- Based on the Price/Earnings ratio, ERCG is valued cheaply inside the industry as 90.63% of the companies are valued more expensively.
- The average S&P500 Price/Earnings ratio is at 26.86. ERCG is valued rather cheaply when compared to this.
- A Price/Forward Earnings ratio of 16.09 indicates a correct valuation of ERCG.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of ERCG indicates a rather cheap valuation: ERCG is cheaper than 84.38% of the companies listed in the same industry.
- When comparing the Price/Forward Earnings ratio of ERCG to the average of the S&P500 Index (37.39), we can say ERCG is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.28 | ||
| Fwd PE | 16.09 |
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 81.25% of the companies listed in the same industry.
- Based on the Price/Free Cash Flow ratio, ERCG is valued cheaper than 81.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.07 | ||
| EV/EBITDA | 8.34 |
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 -4.80% in the coming years.
PEG (NY)N/A
PEG (5Y)1.28
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
5. ERCG.DE Dividend Analysis
5.1 Amount
- ERCG has a Yearly Dividend Yield of 2.70%.
- Compared to an average industry Dividend Yield of 2.35, ERCG pays a better dividend. On top of this ERCG pays more dividend than 90.63% of the companies listed in the same industry.
- ERCG's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
5.2 History
- The dividend of ERCG is nicely growing with an annual growth rate of 13.68%!
Dividend Growth(5Y)13.68%
Div Incr Years2
Div Non Decr Years7
5.3 Sustainability
- 33.41% of the earnings are spent on dividend by ERCG. This is a low number and sustainable payout ratio.
DP33.41%
EPS Next 2Y-9.78%
EPS Next 3Y-4.8%
ERCG.DE Fundamentals: All Metrics, Ratios and Statistics
FRA:ERCG (4/10/2026, 7:00:00 PM)
10.44
+0.3 (+2.96%)
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/bmo
Inst Owners58.35%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap35.20B
Revenue(TTM)236.68B
Net Income(TTM)28.43B
Analysts56.55
Price Target8.85 (-15.23%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.7% |
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)0.94%
PT rev (3m)9.08%
EPS NQ rev (1m)0.88%
EPS NQ rev (3m)5.69%
EPS NY rev (1m)0.81%
EPS NY rev (3m)5.9%
Revenue NQ rev (1m)0.03%
Revenue NQ rev (3m)0.16%
Revenue NY rev (1m)-0.12%
Revenue NY rev (3m)-1.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.28 | ||
| Fwd PE | 16.09 | ||
| P/S | 1.61 | ||
| P/FCF | 13.07 | ||
| P/OCF | 11.57 | ||
| P/B | 3.48 | ||
| P/tB | 7.17 | ||
| EV/EBITDA | 8.34 |
EPS(TTM)0.85
EY8.14%
EPS(NY)0.65
Fwd EY6.22%
FCF(TTM)0.8
FCFY7.65%
OCF(TTM)0.9
OCFY8.64%
SpS6.48
BVpS3
TBVpS1.46
PEG (NY)N/A
PEG (5Y)1.28
Graham Number7.57
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)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 Rank | Sector 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
WACC5.84%
ROIC/WACC1.52
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)440.4%
EPS 3Y13.71%
EPS 5Y9.62%
EPS Q2Q%36.79%
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%-4.98%
Revenue Next Year-1.63%
Revenue Next 2Y0.03%
Revenue Next 3Y0.89%
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 6 / 10 to ERICSSON LM-A SHS (ERCG.DE). This can be considered as Fairly Valued.
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%.