Executive Summary
Telefonaktiebolaget LM Ericsson (publ) provides information and communications technology solutions for service providers. More Details
Rewards
Risk Analysis
Snowflake Analysis
Reasonable growth potential with adequate balance sheet.
Similar Companies
Share Price & News
How has Telefonaktiebolaget LM Ericsson's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: ERIC B is less volatile than 75% of Swedish stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: ERIC B's weekly volatility (4%) has been stable over the past year.
Market Performance
7 Day Return
-1.6%
ERIC B
0.04%
SE Communications
0.2%
SE Market
1 Year Return
19.2%
ERIC B
20.5%
SE Communications
17.5%
SE Market
Return vs Industry: ERIC B underperformed the Swedish Communications industry which returned 20.5% over the past year.
Return vs Market: ERIC B exceeded the Swedish Market which returned 17.5% over the past year.
Shareholder returns
| ERIC B | Industry | Market | |
|---|---|---|---|
| 7 Day | -1.6% | 0.04% | 0.2% |
| 30 Day | 1.3% | 2.8% | 7.5% |
| 90 Day | 6.5% | 6.7% | 9.8% |
| 1 Year | 21.2%19.2% | 22.5%20.5% | 19.5%17.5% |
| 3 Year | 106.9%97.4% | 101.9%92.7% | 43.1%27.6% |
| 5 Year | 52.4%36.5% | 50.9%35.3% | 70.4%37.3% |
Long-Term Price Volatility Vs. Market
How volatile is Telefonaktiebolaget LM Ericsson's share price compared to the market and industry in the last 5 years?
Simply Wall St News
1 week ago | Simply Wall St
Is Telefonaktiebolaget LM Ericsson (STO:ERIC B) Likely To Turn Things Around?3 weeks ago | Simply Wall St
Shareholders Are Thrilled That The Telefonaktiebolaget LM Ericsson (STO:ERIC B) Share Price Increased 108%1 month ago | Simply Wall St
Telefonaktiebolaget LM Ericsson (publ) Just Beat EPS By 32%: Here's What Analysts Think Will Happen NextValuation
Is Telefonaktiebolaget LM Ericsson undervalued compared to its fair value and its price relative to the market?
17.1%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: ERIC B (SEK104.4) is trading below our estimate of fair value (SEK125.87)
Significantly Below Fair Value: ERIC B is trading below fair value, but not by a significant amount.
Price To Earnings Ratio
PE vs Industry: ERIC B is good value based on its PE Ratio (24.1x) compared to the XE Communications industry average (28.5x).
PE vs Market: ERIC B is poor value based on its PE Ratio (24.1x) compared to the Swedish market (22.6x).
Price to Earnings Growth Ratio
PEG Ratio: ERIC B is poor value based on its PEG Ratio (1.6x)
Price to Book Ratio
PB vs Industry: ERIC B is overvalued based on its PB Ratio (4.2x) compared to the SE Communications industry average (1.6x).
Next Steps
Future Growth
How is Telefonaktiebolaget LM Ericsson forecast to perform in the next 1 to 3 years based on estimates from 23 analysts?
14.6%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: ERIC B's forecast earnings growth (14.6% per year) is above the savings rate (0.5%).
Earnings vs Market: ERIC B's earnings (14.6% per year) are forecast to grow faster than the Swedish market (11.5% per year).
High Growth Earnings: ERIC B's earnings are forecast to grow, but not significantly.
Revenue vs Market: ERIC B's revenue (3.8% per year) is forecast to grow faster than the Swedish market (3.5% per year).
High Growth Revenue: ERIC B's revenue (3.8% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: ERIC B's Return on Equity is forecast to be high in 3 years time (20.2%)
Next Steps
Past Performance
How has Telefonaktiebolaget LM Ericsson performed over the past 5 years?
-13.9%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: ERIC B has high quality earnings.
Growing Profit Margin: ERIC B became profitable in the past.
Past Earnings Growth Analysis
Earnings Trend: ERIC B's earnings have declined by 13.9% per year over the past 5 years.
Accelerating Growth: ERIC B has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Earnings vs Industry: ERIC B has become profitable in the last year, making it difficult to compare its past year earnings growth to the Communications industry (2.9%).
Return on Equity
High ROE: ERIC B's Return on Equity (18.1%) is considered low.
Next Steps
Financial Health
How is Telefonaktiebolaget LM Ericsson's financial position?
Financial Position Analysis
Short Term Liabilities: ERIC B's short term assets (SEK155.7B) exceed its short term liabilities (SEK123.4B).
Long Term Liabilities: ERIC B's short term assets (SEK155.7B) exceed its long term liabilities (SEK71.3B).
Debt to Equity History and Analysis
Debt Level: ERIC B's debt to equity ratio (44.5%) is considered high.
Reducing Debt: ERIC B's debt to equity ratio has increased from 18.7% to 44.5% over the past 5 years.
Debt Coverage: ERIC B's debt is well covered by operating cash flow (42.3%).
Interest Coverage: ERIC B earns more interest than it pays, so coverage of interest payments is not a concern.
Balance Sheet
Next Steps
Dividend
What is Telefonaktiebolaget LM Ericsson current dividend yield, its reliability and sustainability?
1.44%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: ERIC B's dividend (1.44%) is higher than the bottom 25% of dividend payers in the Swedish market (1.07%).
High Dividend: ERIC B's dividend (1.44%) is low compared to the top 25% of dividend payers in the Swedish market (3.8%).
Stability and Growth of Payments
Stable Dividend: ERIC B's dividend payments have been volatile in the past 10 years.
Growing Dividend: ERIC B's dividend payments have fallen over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonably low payout ratio (34.6%), ERIC B's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: ERIC B's dividends in 3 years are forecast to be well covered by earnings (40.1% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
3.9yrs
Average management tenure
CEO
E. Ekholm (57 yo)
3.92yrs
Tenure
kr133,212
Compensation
Mr. E. Börje Ekholm, MSc, MBA serves as Independent Director of Trimble Inc. since January 04, 2020. He has been the Chief Executive Officer and President of Telefonaktiebolaget LM Ericsson (publ) since Ja...
CEO Compensation Analysis
Compensation vs Market: E.'s total compensation ($USD15.76K) is below average for companies of similar size in the Swedish market ($USD1.81M).
Compensation vs Earnings: E.'s compensation has been consistent with company performance over the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 3.92yrs | kr133.21k | 0.031% SEK 107.9m | |
| Senior VP | 3.67yrs | no data | 0.0015% SEK 5.2m | |
| Chief Accounting Officer | no data | no data | no data | |
| Group CTO | 3.42yrs | no data | no data | |
| VP & Head of Investor Relations | 7.25yrs | no data | no data | |
| Senior VP | 2.67yrs | no data | no data | |
| SVP, Chief Marketing & Communications Officer and Head of Group Function Mktg. & Corporate Relations | 1.5yrs | no data | no data | |
| Senior VP | 4.08yrs | no data | 0.0010% SEK 3.5m | |
| VP & Head of External Communications | no data | no data | no data | |
| Head of Group Function Financial Control | no data | no data | no data | |
| Senior VP and Head of Market Area South East Asia | 10.67yrs | no data | 0.0014% SEK 5.0m | |
| Head of Region Latin America | 10.67yrs | no data | no data |
3.9yrs
Average Tenure
56yo
Average Age
Experienced Management: ERIC B's management team is considered experienced (3.9 years average tenure).
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| President | 3.92yrs | kr133.21k | 0.031% SEK 107.9m | |
| Independent Director | 7.67yrs | kr1.38m | 0.00012% SEK 418.2k | |
| Independent Director | 2.75yrs | kr1.13m | 0.0015% SEK 5.2m | |
| Deputy Independent Chairman | 4.67yrs | kr1.09m | 0.00060% SEK 2.1m | |
| Deputy Independent Chairman | no data | kr1.03m | 0.013% SEK 44.8m | |
| Independent Director | 3.75yrs | kr958.79k | no data | |
| Independent Director | 4.67yrs | kr1.17m | no data | |
| Employee Representative Director | 2.75yrs | kr40.50k | 0.0010% SEK 3.5m | |
| Independent Chairman of the Board | 2.75yrs | kr3.80m | 0.0030% SEK 10.5m | |
| Employee Representative Director | 3.75yrs | kr36.00k | 0.00044% SEK 1.5m | |
| Independent Director | 3.75yrs | kr1.33m | 0.00030% SEK 1.0m | |
| Employee Representative Director | 3.75yrs | kr40.50k | 0.00027% SEK 941.0k |
3.8yrs
Average Tenure
59.5yo
Average Age
Experienced Board: ERIC B's board of directors are considered experienced (3.8 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Telefonaktiebolaget LM Ericsson (publ)'s company bio, employee growth, exchange listings and data sources
Key Information
- Name: Telefonaktiebolaget LM Ericsson (publ)
- Ticker: ERIC B
- Exchange: OM
- Founded: 1876
- Industry: Communications Equipment
- Sector: Tech
- Market Cap: kr348.528b
- Shares outstanding: 3.33b
- Website: https://www.ericsson.com
Number of Employees
Location
- Telefonaktiebolaget LM Ericsson (publ)
- Torshamnsgatan 21
- Kista
- Stockholm
- Stockholm County
- 164 83
- Sweden
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| ERIC | NasdaqGS (Nasdaq Global Select) | ADR EACH REP 1 ORD'B'SEK1 | US | USD | Dec 1972 | |
| ERIC N | BMV (Bolsa Mexicana de Valores) | ADR EACH REP 1 ORD'B'SEK1 | MX | MXN | Dec 1972 | |
| ERCA | DB (Deutsche Boerse AG) | ADR EACH REP 1 ORD'B'SEK1 | DE | EUR | Dec 1972 | |
| ERCA | XTRA (XETRA Trading Platform) | ADR EACH REP 1 ORD'B'SEK1 | DE | EUR | Dec 1972 | |
| ERIX.F | OTCPK (Pink Sheets LLC) | Yes | Class B Shares | US | USD | Sep 1990 |
| ERIC B | OM (OMX Nordic Exchange Stockholm) | Yes | Class B Shares | SE | SEK | Sep 1990 |
| ERCB | DB (Deutsche Boerse AG) | Yes | Class B Shares | DE | EUR | Sep 1990 |
| 0O87 | LSE (London Stock Exchange) | Yes | Class B Shares | GB | SEK | Sep 1990 |
| ERIBR | HLSE (OMX Nordic Exchange Helsinki) | Yes | Class B Shares | FI | EUR | Sep 1990 |
| ERICB | SWX (SIX Swiss Exchange) | Yes | Class B Shares | CH | CHF | Sep 1990 |
| ERCB | XTRA (XETRA Trading Platform) | Yes | Class B Shares | DE | EUR | Sep 1990 |
| ERICBS | BATS-CHIXE (BATS 'Chi-X Europe') | Yes | Class B Shares | GB | SEK | Sep 1990 |
| ERIBRH | BATS-CHIXE (BATS 'Chi-X Europe') | Yes | Class B Shares | GB | EUR | Sep 1990 |
| ERCB | ETLX (Eurotlx) | Yes | Class B Shares | IT | EUR | Sep 1990 |
| ERIC A | OM (OMX Nordic Exchange Stockholm) | Class A Shares | SE | SEK | Jan 1992 | |
| ERCG | XTRA (XETRA Trading Platform) | Class A Shares | DE | EUR | Jan 1992 | |
| 0O86 | LSE (London Stock Exchange) | Class A Shares | GB | SEK | Jan 1992 | |
| ERCG | DB (Deutsche Boerse AG) | Class A Shares | DE | EUR | Jan 1992 | |
| ERICAS | BATS-CHIXE (BATS 'Chi-X Europe') | Class A Shares | GB | SEK | Jan 1992 |
Biography
Telefonaktiebolaget LM Ericsson (publ) provides information and communications technology solutions for service providers. It operates through four segments: Networks, Digital Services, Managed Services, a...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2020/12/04 19:22 |
| End of Day Share Price | 2020/12/04 00:00 |
| Earnings | 2020/09/30 |
| Annual Earnings | 2019/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.