Ericsson Stock Analysis (NASDAQ:ERIC)

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$6.46 $0.03 (0.46%) ERIC stock closing price Mar 23, 2017 (Closing)
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Ericsson
Updated on : Mar 23, 2017
previous close
ERIC 6.5 (0%)
NASDAQ 5817.7 (0%)
Closing Price On: Mar 23, 2017
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Wireless Equipment
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2016-Q4
$billion
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
-5.8%
Operating Profit
Operating Margin:
2.8%
Sector Average:
2.7%
5 Quarter Net Profit
Net Margins
2016-Q4
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
3.12B
Debt/Equity Ratio:
 0.19
Compared to the industry
Cash Flow
Operating cash flow:
$2.28B
Net Income:
-$177.4M
Dividend Yield
ERIC dividend yield:
4.64%
PROS      CONS
FCF Margin
High Dividend Yield
PE Valuation
PS Valuation
Long Term Growth
High Debt Burden
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
ERIC PS :
0.8
Industry PS :
2.6
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
2.1%
Return on Equity:
1.3%
Free Cash Flow Margin:
27.4%
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Ericsson Analysis Video

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View Ericsson stock analysis video. This is our ERIC analyst opinion covering the buy and sell arguments for ERIC stock.

Telefonaktiebolaget LM Ericsson Stock Rating (2.7/5)

Our Ericsson stock opinion is based on fundamentals of the company. This Ericsson stock analysis is based on latest Q4 earnings for 2016. The stock price analysis takes into account a company's valuation metrics.

Should you buy ERIC stock?

  • The price to earnings multiple of 20.8 is attractive when compared with the industry average PE ratio of 25.8.
  • ERIC stock is trading at a favorable price to sales multiple of 0.8 as against the Wireless Equipment industry average multiple of 2.6.
  • The company has a healthy dividend yield of 4.64%.
  • Ericsson has a healthy FCF (Free Cash Flow) margin of 27.4%.

Should you sell ERIC stock?

  • Revenue declined at a CAGR of -5.8% over the last 5 years.
  • With a debt/equity ratio of  0.19, Ericsson is highly leveraged in comparison to Computer and Technology peers.

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