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Ericsson (ERIC) Gains But Lags Market: What You Should Know

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Ericsson (ERIC - Free Report) closed at $9.70 in the latest trading session, marking a +0.26% move from the prior day. This change lagged the S&P 500's 2.14% gain on the day. Meanwhile, the Dow gained 2.06%, and the Nasdaq, a tech-heavy index, added 2.65%.

Prior to today's trading, shares of the telecommunications equipment provider had lost 0.63% over the past month. This has was narrower than the Computer and Technology sector's loss of 10.97% and the S&P 500's loss of 6.63% in that time.

Investors will be hoping for strength from ERIC as it approaches its next earnings release. In that report, analysts expect ERIC to post earnings of $0.08 per share. This would mark year-over-year growth of 900%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.75 billion, down 0.08% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.38 per share and revenue of $23.63 billion, which would represent changes of +1166.67% and -3.85%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ERIC. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. ERIC is currently a Zacks Rank #1 (Strong Buy).

Investors should also note ERIC's current valuation metrics, including its Forward P/E ratio of 24.94. Its industry sports an average Forward P/E of 23.1, so we one might conclude that ERIC is trading at a premium comparatively.

The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 11, which puts it in the top 5% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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