Telefonaktiebolaget LM Ericsson (publ) (ERIC-B.ST) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

+65.1%

SEK 177.74

vs SEK 107.65 price

Levered DCF

SEK 159.25

After debt service

Piotroski score

6 / 9

Average

Altman Z-score

2.33

Grey zone

Rating

A-

Overall 4 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	10.62×	14,980×	-8.03×	10.84×	14.63×	18.56×	121.73×	-38.96×
P/B	2.76×	3.18×	2.15×	1.5×	3.05×	3.74×	3.27×	2.92×
P/S	1.28×	1.21×	0.81×	0.75×	1.43×	1.4×	1.19×	1.2×
EV / EBITDA	5.94×	18.63×	-23.25×	5.63×	8.04×	8.49×	13.56×	53.71×
Gross margin	48.1%	44.1%	39.6%	41.7%	43.4%	40.3%	37.3%	32.3%
Operating margin	13.8%	2.5%	0.0%	10.0%	13.7%	12.0%	4.6%	0.6%
Net margin	12.0%	0.0%	-10.0%	6.9%	9.8%	7.5%	1.0%	-3.1%
Current ratio	1.29×	1.17×	1.2×	1.19×	1.38×	1.31×	1.32×	1.45×
Debt / equity	0.37×	0.48×	0.55×	0.31×	0.38×	0.46×	0.58×	0.38×
Interest coverage	10.73×	1.76×	0.02×	15.07×	18.25×	17.45×	5.44×	0.62×
Dividend yield	3.2%	3.1%	4.2%	4.1%	2.1%	1.8%	1.7%	1.3%
Payout ratio	33.6%	46165.0%	-34.0%	44.5%	30.4%	34.3%	200.2%	-52.5%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	26.0%	0.0%	-26.8%	13.9%	20.9%	20.2%	2.7%	-7.5%
Return on invested capital	14.1%	0.5%	0.0%	9.9%	13.1%	10.8%	1.3%	0.8%
Return on assets	10.2%	0.0%	-8.5%	5.4%	7.4%	6.4%	0.8%	-2.4%
Free cash flow yield	10.0%	14.2%	0.8%	12.2%	10.4%	7.3%	3.8%	1.7%
Earnings yield	9.4%	0.0%	-12.5%	9.2%	6.8%	5.4%	0.8%	-2.6%
Enterprise value	SEK 298.4B	SEK 301.1B	SEK 231.5B	SEK 206.7B	SEK 319.3B	SEK 320.3B	SEK 272.1B	SEK 248.6B
Net debt / EBITDA	-0.07×	0.1×	-1.92×	0.11×	-0.33×	-0.11×	0.12×	-1.14×
Cash conversion cycle (days)	89	92	97	122	108	98	113	145