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Ericsson (ERIC) Solution to Aid UK Network Modernization

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Ericsson (ERIC - Free Report) recently inked an agreement with Virgin Media O2 to accelerate network modernization in the United Kingdom. The deal of an undisclosed amount is an extension of a long business relationship and aims to provide reliable and faster connectivity to end users.

Virgin Media intends to enhance 5G connectivity by utilizing Ericsson’s latest quad-technology baseband, multiband and industry-leading 5G Massive MIMO radio AIR 3258.  The technology also mitigates the adverse environmental impact as it will consume 30% less energy than available variants and a 40% reduction in weight and volume to expedite the network deployment.

Per the deal, Virgin Media will facilitate the testing of Ericsson's most recent Cloud RAN (Radio Access Network) solution. The system operates in a cloud computing environment, which offers incredibly scalable, adaptable, and reliable applications that enable organizations to act quickly and develop innovative solutions. Apart from substantial advancement of hardware, software and other network infrastructure, the deal includes additional upgrades and small-cell solutions. This will likely improve mobile capacity, coverage and speed for customers in major U.K. cities such as Manchester, Liverpool and Belfast.

Ericsson is witnessing solid demand trends for its 4G and 5G RAN technology that accentuate the strength of its Radio System portfolio and acceptance of its latest innovation among customers. The company is benefiting from solid 5G momentum worldwide. Investments in research and development (R&D) have established it as a leader in 5G. In the Mobile Networks business, Ericsson plans to capitalize on the convergence of cloud, software, and services by merging Digital Services and Managed Services to form a new segment dubbed Cloud Software and Services.

With the emergence of the smartphone market and subsequent usage of mobile broadband, user demand for coverage speed and quality has recently increased. To maintain superior performance as traffic increases, there is also a continuous need for network tuning and optimization. Ericsson is much in demand among operators to expand network coverage and upgrade networks for higher speed and capacity.

The company is focused on structural changes that will generate lasting efficiency gains and boost cost competitiveness. Courtesy of investing in R&D combined with operational efficiency, Ericsson has the world’s leading patent portfolio in cellular technology, with 60,000 granted patents and more than 100 signed licensing agreements. It is also focused on stabilizing its IT, cloud and project portfolio and re-establishing profitability in Managed Services by handling existing contracts and investing in automation and artificial intelligence.

The stock has lost 40.4% in the past year compared with the industry’s decline of 18.9%.

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Ericsson currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

InterDigital, Inc. (IDCC - Free Report) , carrying a Zacks Rank 2 (Buy), delivered an earnings surprise of 40.33% on average in the trailing four quarters and delivered an earnings surprise of 17.39% in the last reported quarter. It is a pioneer in advanced mobile technologies that enables wireless communications and capabilities. The company designs and develops a wide range of advanced technology solutions, which are used in digital cellular and wireless 3G, 4G and IEEE 802-related products and networks.

It is focused on pursuing agreements with unlicensed customers in the handset and consumer electronics markets. The company aims to become a leading designer and developer of technology solutions and innovation for the mobile industry, IoT and allied technology areas by leveraging its R&D capabilities, technological know-how and rich industry experience.

Juniper Networks, Inc. (JNPR - Free Report) , carrying a Zacks Rank #2, delivered an earnings surprise of 1.55%, on average, in the trailing four quarters and has an Earnings ESP of +2.38%. It is witnessing strong momentum across its core industry verticals and is confident of its long-term prospects. Investments in customer solutions and sales organizations have enabled the company to capitalize on the solid demand across end markets.

Juniper is a leading provider of networking solutions and communication devices. The company develops, designs and sells products that help build a network infrastructure for services and applications based on a single Internet protocol network worldwide. The company caters to the networking needs of enterprises, public sector organizations and service providers across the globe.

Arista Networks, Inc. (ANET - Free Report) , sporting a Zacks Rank #1, delivered an earnings surprise of 14.17%, on average, in the trailing four quarters. Earnings estimates for ANET for the current year stand at $5.79 per share. Arista provides cloud networking solutions for data centers and cloud computing environments. The company offers 10/25/40/50/100 Gigabit Ethernet switches and routers optimized for next-generation data center networks.

It continues to benefit from strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. It is well-poised for growth in data-driven cloud networking business with proactive platforms and predictive operations. Arista has introduced network observability software, DANZ Monitoring Fabric (DMF), on its switching platforms for enterprise-wide traffic visibility and contextual insights.

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