Ericsson (ERIC) closed the most recent trading day at $5.07, moving +0.1% from the previous trading session. The stock outpaced the S&P 500’s daily gain of 0.07%. At the same time, the Dow added 0.02%, and the tech-heavy Nasdaq gained 0.01%.
Prior to today’s trading, shares of the telecommunications equipment provider had gained 3.06% over the past month. This has outpaced the Computer and Technology sector’s gain of 1.5% and the S&P 500’s gain of 0.38% in that time.
Wall Street will be looking for positivity from Ericsson as it approaches its next earnings report date. On that day, Ericsson is projected to report earnings of $0.07 per share, which would represent a year-over-year decline of 56.25%. Meanwhile, our latest consensus estimate is calling for revenue of $6.39 billion, down 1.04% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.31 per share and revenue of $26.42 billion. These totals would mark changes of -49.18% and -1.19%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Ericsson. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Ericsson is holding a Zacks Rank of #3 (Hold) right now.
Investors should also note Ericsson’s current valuation metrics, including its Forward P/E ratio of 16.11. Its industry sports an average Forward P/E of 13.61, so we one might conclude that Ericsson is trading at a premium comparatively.
We can also see that ERIC currently has a PEG ratio of 7.9. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. ERIC’s industry had an average PEG ratio of 1.34 as of yesterday’s close.
The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 94, which puts it in the top 38% 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.