Key Highlights:
- Ericsson's Q1 GAAP EPS reached SEK 1.24 with a year-over-year revenue growth of 3.2% to SEK 55.03 billion.
- Wall Street analysts predict a potential downside in Ericsson's stock price despite a "Hold" consensus rating.
- GuruFocus estimates indicate a larger downside from the current trading price based on historical data and growth forecasts.
Ericsson's Financial Performance: An Overview
In the first quarter, Ericsson (ERIC, Financial) reported impressive financial results, with its GAAP EPS standing at SEK 1.24. The company's revenue grew by 3.2% year-over-year, reaching SEK 55.03 billion. Notably, the adjusted gross margin improved to 48.5%, highlighting operational efficiency. Additionally, Ericsson has announced a proposed 2024 dividend of SEK 2.85 per share, to be distributed in two parts in 2025, which reflects confidence in its future cash flows.
Analyst Predictions for Ericsson
Wall Street analysts have provided one-year price targets for Telefonaktiebolaget L M Ericsson (ERIC, Financial). The average target price is set at $6.95, with estimates ranging from a high of $8.54 to a low of $5.60. This average target suggests a potential downside of 6.68% from the current trading price of $7.45. For further insights, detailed estimates are accessible on the Telefonaktiebolaget L M Ericsson (ERIC) Forecast page.
Brokerage Recommendations: A 'Hold' Status
The consensus among nine brokerage firms places Telefonaktiebolaget L M Ericsson (ERIC, Financial) at an average recommendation rating of 3.2, indicating a "Hold" position. This rating is derived from a scale of 1 to 5, where 1 equates to a Strong Buy and 5 signifies Sell. This suggests a cautious approach towards investing in Ericsson at this juncture.
GuruFocus Valuation Perspective
According to GuruFocus estimates, the GF Value for Ericsson in the coming year is projected at $5.74. This implies a significant downside of 22.95% from its current price of $7.45. The GF Value is a proprietary measure by GuruFocus, providing an estimate of the stock's fair trading value based on historical trading multiples, past growth trends, and anticipated future performance. For more comprehensive data, the Telefonaktiebolaget L M Ericsson (ERIC, Financial) Summary page offers extensive insights.
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