Ericsson (ERIC) Rises But Trails Market: What Investors Should Know
Ericsson (ERIC) closed at $5.58 in the latest trading session, marking a +0.18% move from the prior day. This change lagged the S&P 500's 1.03% gain on the day. Meanwhile, the Dow experienced a rise of 0.34%, and the technology-dominated Nasdaq saw an increase of 1.51%.
Coming into today, shares of the telecommunications equipment provider had gained 4.11% in the past month. In that same time, the Computer and Technology sector gained 2.52%, while the S&P 500 gained 3.21%.
Investors will be eagerly watching for the performance of Ericsson in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.04, signifying a 50% drop compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $5.33 billion, reflecting a 10.95% fall from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $0.42 per share and a revenue of $24.03 billion, indicating changes of -2.33% and -3.23%, respectively, from the former year.
Any recent changes to analyst estimates for Ericsson should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Ericsson is currently sporting a Zacks Rank of #3 (Hold).
From a valuation perspective, Ericsson is currently exchanging hands at a Forward P/E ratio of 13.32. This expresses a discount compared to the average Forward P/E of 14.15 of its industry.
The Wireless Equipment industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 176, finds itself in the bottom 31% echelons of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ERIC in the coming trading sessions, be sure to utilize Zacks.com.
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