ERICSSON LM-B SHS (ERCB.DE) Stock Fundamental Analysis
Europe - FRA:ERCB - SE0000108656 - Common Stock
8.158 EUR
-0.07 (-0.87%)
Taking everything into account, ERCB scores 6 out of 10 in our fundamental rating. ERCB was compared to 29 industry peers in the Communications Equipment industry. ERCB has an excellent profitability rating, but there are some minor concerns on its financial health. ERCB is valued quite cheap, while showing a decent growth score. This is a good combination! ERCB also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ERCB had positive earnings in the past year.
In the past year ERCB had a positive cash flow from operations.
ERCB had positive earnings in 4 of the past 5 years.
Each year in the past 5 years ERCB had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 8.72%, ERCB belongs to the best of the industry, outperforming 82.76% of the companies in the same industry.
ERCB has a Return On Equity of 24.01%. This is amongst the best in the industry. ERCB outperforms 86.21% of its industry peers.
ERCB has a Return On Invested Capital of 16.85%. This is amongst the best in the industry. ERCB outperforms 89.66% of its industry peers.
ERCB had an Average Return On Invested Capital over the past 3 years of 9.43%. This is below the industry average of 12.11%.
The 3 year average ROIC (9.43%) for ERCB is below the current ROIC(16.85%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.72% | ||
| ROE | 24.01% | ||
| ROIC | 16.85% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)9.43%
ROIC(5y)10.87%
1.3 Margins
ERCB has a better Profit Margin (10.26%) than 82.76% of its industry peers.
ERCB's Profit Margin has declined in the last couple of years.
ERCB has a better Operating Margin (16.13%) than 82.76% of its industry peers.
In the last couple of years the Operating Margin of ERCB has grown nicely.
With a Gross Margin value of 47.62%, ERCB perfoms like the industry average, outperforming 55.17% of the companies in the same industry.
In the last couple of years the Gross Margin of ERCB has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.13% | ||
| PM (TTM) | 10.26% | ||
| GM | 47.62% |
OM growth 3Y-12.66%
OM growth 5Y14.26%
PM growth 3Y-90.62%
PM growth 5Y-61.69%
GM growth 3Y1.11%
GM growth 5Y3.7%
2. Health
2.1 Basic Checks
ERCB has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
ERCB has about the same amout of shares outstanding than it did 1 year ago.
ERCB has more shares outstanding than it did 5 years ago.
ERCB has a better debt/assets ratio than last year.
2.2 Solvency
The Debt to FCF ratio of ERCB is 1.45, which is an excellent value as it means it would take ERCB, only 1.45 years of fcf income to pay off all of its debts.
ERCB has a Debt to FCF ratio of 1.45. This is in the better half of the industry: ERCB outperforms 79.31% of its industry peers.
ERCB has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.35, ERCB is in line with its industry, outperforming 58.62% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 1.45 | ||
| Altman-Z | N/A |
ROIC/WACC2.7
WACC6.23%
2.3 Liquidity
A Current Ratio of 1.17 indicates that ERCB should not have too much problems paying its short term obligations.
ERCB has a Current ratio of 1.17. This is in the lower half of the industry: ERCB underperforms 75.86% of its industry peers.
A Quick Ratio of 0.94 indicates that ERCB may have some problems paying its short term obligations.
ERCB has a worse Quick ratio (0.94) than 65.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
ERCB shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 395.75%, which is quite impressive.
Measured over the past years, ERCB shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -17.01% on average per year.
ERCB shows a decrease in Revenue. In the last year, the revenue decreased by -2.65%.
Measured over the past years, ERCB shows a small growth in Revenue. The Revenue has been growing by 1.76% on average per year.
EPS 1Y (TTM)395.75%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%-5.34%
Revenue 1Y (TTM)-2.65%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%-10.28%
3.2 Future
The Earnings Per Share is expected to grow by 29.10% on average over the next years. This is a very strong growth
ERCB is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.77% yearly.
EPS Next Y271.88%
EPS Next 2Y89.39%
EPS Next 3Y55.91%
EPS Next 5Y29.1%
Revenue Next Year-3.55%
Revenue Next 2Y-1.45%
Revenue Next 3Y-0.62%
Revenue Next 5Y-0.77%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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
ERCB is valuated correctly with a Price/Earnings ratio of 13.60.
Based on the Price/Earnings ratio, ERCB is valued cheaper than 96.55% of the companies in the same industry.
ERCB is valuated rather cheaply when we compare the Price/Earnings ratio to 26.91, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 14.54, ERCB is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ERCB indicates a somewhat cheap valuation: ERCB is cheaper than 79.31% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.92. ERCB is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.6 | ||
| Fwd PE | 14.54 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ERCB is valued cheaply inside the industry as 89.66% of the companies are valued more expensively.
ERCB's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ERCB is cheaper than 72.41% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.77 | ||
| EV/EBITDA | 5.87 |
4.3 Compensation for Growth
ERCB's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of ERCB may justify a higher PE ratio.
ERCB's earnings are expected to grow with 55.91% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.05
PEG (5Y)N/A
EPS Next 2Y89.39%
EPS Next 3Y55.91%
5. Dividend
5.1 Amount
ERCB has a Yearly Dividend Yield of 3.18%.
Compared to an average industry Dividend Yield of 5.20, ERCB pays a better dividend. On top of this ERCB pays more dividend than 89.66% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, ERCB pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.18% |
5.2 History
The dividend of ERCB 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
37.84% of the earnings are spent on dividend by ERCB. This is a low number and sustainable payout ratio.
The dividend of ERCB is growing, but earnings are growing more, so the dividend growth is sustainable.
DP37.84%
EPS Next 2Y89.39%
EPS Next 3Y55.91%
FRA:ERCB (10/24/2025, 7:00:00 PM)
8.158
-0.07 (-0.87%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners54.97%
Inst Owner ChangeN/A
Ins Owners0.07%
Ins Owner ChangeN/A
Market Cap27.19B
Revenue(TTM)240.31B
Net Income(TTM)24.64B
Analysts56.43
Price Target7.12 (-12.72%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.18% |
Yearly Dividend0.25
Dividend Growth(5Y)22.02%
DP37.84%
Div Incr Years1
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.35%
Min EPS beat(2)-21.32%
Max EPS beat(2)20.62%
EPS beat(4)2
Avg EPS beat(4)9.6%
Min EPS beat(4)-21.32%
Max EPS beat(4)49.81%
EPS beat(8)5
Avg EPS beat(8)-42.25%
EPS beat(12)8
Avg EPS beat(12)-19.96%
EPS beat(16)9
Avg EPS beat(16)-14.95%
Revenue beat(2)0
Avg Revenue beat(2)-4.34%
Min Revenue beat(2)-6.39%
Max Revenue beat(2)-2.29%
Revenue beat(4)0
Avg Revenue beat(4)-2.81%
Min Revenue beat(4)-6.39%
Max Revenue beat(4)-0.45%
Revenue beat(8)1
Avg Revenue beat(8)-2.49%
Revenue beat(12)3
Avg Revenue beat(12)-1.62%
Revenue beat(16)7
Avg Revenue beat(16)-0.77%
PT rev (1m)-0.95%
PT rev (3m)6.77%
EPS NQ rev (1m)-6.48%
EPS NQ rev (3m)-32.07%
EPS NY rev (1m)-1.05%
EPS NY rev (3m)1.18%
Revenue NQ rev (1m)-1.18%
Revenue NQ rev (3m)-11.66%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-3.89%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.6 | ||
| Fwd PE | 14.54 | ||
| P/S | 1.24 | ||
| P/FCF | 9.77 | ||
| P/OCF | 8.74 | ||
| P/B | 2.89 | ||
| P/tB | 6.62 | ||
| EV/EBITDA | 5.87 |
EPS(TTM)0.6
EY7.35%
EPS(NY)0.56
Fwd EY6.88%
FCF(TTM)0.84
FCFY10.24%
OCF(TTM)0.93
OCFY11.44%
SpS6.6
BVpS2.82
TBVpS1.23
PEG (NY)0.05
PEG (5Y)N/A
Graham Number6.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.72% | ||
| ROE | 24.01% | ||
| ROCE | 23.94% | ||
| ROIC | 16.85% | ||
| ROICexc | 24.6% | ||
| ROICexgc | 51.38% | ||
| OM | 16.13% | ||
| PM (TTM) | 10.26% | ||
| GM | 47.62% | ||
| FCFM | 12.65% |
ROA(3y)-1.18%
ROA(5y)2.06%
ROE(3y)-4.3%
ROE(5y)5.63%
ROIC(3y)9.43%
ROIC(5y)10.87%
ROICexc(3y)13.21%
ROICexc(5y)15.92%
ROICexgc(3y)41.96%
ROICexgc(5y)38.68%
ROCE(3y)13.4%
ROCE(5y)15.43%
ROICexgc growth 3Y9.12%
ROICexgc growth 5Y7.91%
ROICexc growth 3Y-8.84%
ROICexc growth 5Y4.9%
OM growth 3Y-12.66%
OM growth 5Y14.26%
PM growth 3Y-90.62%
PM growth 5Y-61.69%
GM growth 3Y1.11%
GM growth 5Y3.7%
F-Score6
Asset Turnover0.85
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.35 | ||
| Debt/FCF | 1.45 | ||
| Debt/EBITDA | 0.73 | ||
| Cap/Depr | 36.83% | ||
| Cap/Sales | 1.48% | ||
| Interest Coverage | 16.56 | ||
| Cash Conversion | 70.13% | ||
| Profit Quality | 123.37% | ||
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | N/A |
F-Score6
WACC6.23%
ROIC/WACC2.7
Cap/Depr(3y)47.04%
Cap/Depr(5y)51.35%
Cap/Sales(3y)1.94%
Cap/Sales(5y)2.02%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)395.75%
EPS 3Y-38.27%
EPS 5Y-17.01%
EPS Q2Q%-5.34%
EPS Next Y271.88%
EPS Next 2Y89.39%
EPS Next 3Y55.91%
EPS Next 5Y29.1%
Revenue 1Y (TTM)-2.65%
Revenue growth 3Y2.19%
Revenue growth 5Y1.76%
Sales Q2Q%-10.28%
Revenue Next Year-3.55%
Revenue Next 2Y-1.45%
Revenue Next 3Y-0.62%
Revenue Next 5Y-0.77%
EBIT growth 1Y92.37%
EBIT growth 3Y-10.75%
EBIT growth 5Y16.26%
EBIT Next Year81.48%
EBIT Next 3Y20.93%
EBIT Next 5Y13.49%
FCF growth 1Y392.6%
FCF growth 3Y7.36%
FCF growth 5Y33.08%
OCF growth 1Y169.74%
OCF growth 3Y5.8%
OCF growth 5Y22.35%
ERICSSON LM-B SHS / ERCB.DE FAQ
Can you provide the ChartMill fundamental rating for ERICSSON LM-B SHS?
ChartMill assigns a fundamental rating of 6 / 10 to ERCB.DE.
What is the valuation status of ERICSSON LM-B SHS (ERCB.DE) stock?
ChartMill assigns a valuation rating of 8 / 10 to ERICSSON LM-B SHS (ERCB.DE). This can be considered as Undervalued.
How profitable is ERICSSON LM-B SHS (ERCB.DE) stock?
ERICSSON LM-B SHS (ERCB.DE) has a profitability rating of 8 / 10.
Can you provide the financial health for ERCB stock?
The financial health rating of ERICSSON LM-B SHS (ERCB.DE) is 4 / 10.
What is the expected EPS growth for ERICSSON LM-B SHS (ERCB.DE) stock?
The Earnings per Share (EPS) of ERICSSON LM-B SHS (ERCB.DE) is expected to grow by 271.88% in the next year.