Ericsson
Find Ratings ReportsTELEFONAKTIEBOLAGET LM ERICS's gross profit margin for the fourth quarter of its fiscal year 2023 has increased when compared to the same period a year ago. Sales and net income have dropped, underperforming the average competitor within its subsector. TELEFONAKTIEBOLAGET LM ERICS has weak liquidity. Currently, the Quick Ratio is 0.78 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has decreased by 24.13% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
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Income Statement | Q4 FY23 | Q4 FY22 |
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Net Sales ($mil) | 8617.78 | 9340.11 |
EBITDA ($mil) | 1440.17 | 1583.05 |
EBIT ($mil) | 820.32 | 1202.7 |
Net Income ($mil) | 108.41 | 656.4 |
Balance Sheet | Q4 FY23 | Q4 FY22 |
---|---|---|
Cash & Equiv. ($mil) | 4452.3 | 4517.01 |
Total Assets ($mil) | 29537.11 | 33532.15 |
Total Debt ($mil) | 5402.35 | 4051.64 |
Equity ($mil) | 9811.99 | 12933.12 |
Profitability | Q4 FY23 | Q4 FY22 |
---|---|---|
Gross Profit Margin | 47.97 | 45.61 |
EBITDA Margin | 16.71 | 16.94 |
Operating Margin | 9.52 | 12.88 |
Sales Turnover | 0.89 | 0.78 |
Return on Assets | -8.9 | 5.35 |
Return on Equity | -26.8 | 13.89 |
Debt | Q4 FY23 | Q4 FY22 |
---|---|---|
Current Ratio | 1.2 | 1.19 |
Debt/Capital | 0.36 | 0.24 |
Interest Expense | 0.0 | 0.0 |
Interest Coverage | 0.0 | 0.0 |
Share Data | Q4 FY23 | Q4 FY22 |
---|---|---|
Shares outstanding (mil) | 3329.99 | 3330.14 |
Div / share | 0.0 | 0.0 |
EPS | 0.03 | 0.2 |
Book value / share | 2.95 | 3.88 |
Institutional Own % | n/a | n/a |
Avg Daily Volume | 1.56825E7 | 1.1456794E7 |
HOLD. The current P/E ratio is negative, which has no meaningful value in the assessment of premium or discount valuation, it simply displays that the company has negative earnings. For additional comparison, its price-to-book ratio of 1.93 indicates a significant discount versus the S&P 500 average of 4.68 and a significant discount versus the subsector average of 23.59. The price-to-sales ratio is well below both the S&P 500 average and the subsector average, indicating a discount. After reviewing these and other key valuation criteria, TELEFONAKTIEBOLAGET LM ERICS proves to trade at a discount to investment alternatives.
Price/Earnings |
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Price/Cash Flow |
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ERIC NM | Peers 53.34 | ERIC 26.50 | Peers 44.47 | |||||||||||||||||||||
Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings. ERIC's P/E is negative making this valuation measure meaningless. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. ERIC is trading at a significant discount to its peers. |
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Price/Projected Earnings |
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Price to Earnings/Growth |
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ERIC 10.12 | Peers 26.06 | ERIC NA | Peers 1.95 | |||||||||||||||||||||
Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations. ERIC is trading at a significant discount to its peers. |
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. Ratio not available. |
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Price/Book |
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Earnings Growth |
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ERIC 1.93 | Peers 23.59 | ERIC -246.29 | Peers 123.02 | |||||||||||||||||||||
Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. ERIC is trading at a significant discount to its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, ERIC is expected to significantly trail its peers on the basis of its earnings growth rate. |
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Price/Sales |
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Sales Growth |
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ERIC 0.72 | Peers 14.13 | ERIC 0.52 | Peers 27.20 | |||||||||||||||||||||
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. ERIC is trading at a significant discount to its subsector on this measurement. |
Lower. A sales growth rate that trails the subsector implies that a company is losing market share. ERIC significantly trails its peers on the basis of sales growth. |
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