NEW YORK (TheStreet) -- Ericsson (ERIC) shares are up 0.5% to $12.12 on Tuesday after the worlds largest wireless network equipment maker said that it is in contract talks with telecom giants AT&T (T) and Verizon (VZ) to manage their networks, Bloomberg reports.
CEO Jean-Cleade Geha believes that the future of the industry lies with service providers outsourcing operations to companies like his.
The Swedish communications technology provider is looking to tap into a market for service management that totaled $273 billion in 2012, half of which was performed by the telecom companies themselves.
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Ericsson already manages Sprint's (S) network.
TheStreet Ratings team rates ERICSSON as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate ERICSSON (ERIC) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."