Telefonaktiebolaget LM Ericsson (ERIC) is now in the Fair zone, suggesting that its current forward PE ratio of 15.48 is considered Fairly compared with the five-year average of 12.60. The fair price of Telefonaktiebolaget LM Ericsson (ERIC) is between 9.73 to 15.42 according to relative valuation method.

Relative Value

Fair Zone

9.73-15.42

Current Price：11.60

Fair

P/E

EV/EBITDA

EV/EBIT

P/S

P/OCF

P/FCF

Trailing

Forward

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Telefonaktiebolaget LM Ericsson (ERIC) has a current Price-to-Book (P/B) ratio of 2.84. Compared to its 3-year average P/B ratio of 2.39, the current P/B ratio is approximately 19.09% higher. Relative to its 5-year average P/B ratio of 2.56, the current P/B ratio is about 10.97% higher. Telefonaktiebolaget LM Ericsson (ERIC) has a Forward Free Cash Flow (FCF) yield of approximately 10.78%. Compared to its 3-year average FCF yield of 10.47%, the current FCF yield is approximately 3.00% lower. Relative to its 5-year average FCF yield of 10.33%, the current FCF yield is about 4.37% lower.

Competitors Valuation Multiple

AI Analysis

The average P/S ratio for ERIC competitors is 5.52, providing a benchmark for relative valuation. Telefonaktiebolaget LM Ericsson Corp (ERIC.O) exhibits a P/S ratio of 1.26, which is -77.11% above the industry average. Given its robust revenue growth of 8.96%, this premium appears unsustainable.

P/E

P/S

EV/EBITDA

EV/EBIT

Earnings Growth

Market Cap

Performance Decomposition

AI Analysis

Market capitalization of ERIC increased by 0.00% over the past 1 year(s). The primary factor behind the change was an decrease in Unknown from 0.00 to 0.00.

The secondary factor is the Unknown, contributed 0.00% to the performance.

Overall, the performance of ERIC in the past 1 year(s) is driven by Unknown.

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Frequently Asked Questions

Is ERIC currently overvalued or undervalued?

What is Telefonaktiebolaget LM Ericsson (ERIC) fair value?

ERIC's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. The fair price of Telefonaktiebolaget LM Ericsson (ERIC) is between 9.73 to 15.42 according to relative valuation method.

How does ERIC's valuation metrics compare to the industry average?

The average P/S ratio for ERIC's competitors is 5.52, providing a benchmark for relative valuation. Telefonaktiebolaget LM Ericsson Corp (ERIC) exhibits a P/S ratio of 1.26, which is -77.11% above the industry average. Given its robust revenue growth of 8.96%, this premium appears unsustainable.

What is the current P/B ratio for Telefonaktiebolaget LM Ericsson (ERIC) as of Mar 02 2026?

As of Mar 02 2026, Telefonaktiebolaget LM Ericsson (ERIC) has a P/B ratio of 2.84. This indicates that the market values ERIC at 2.84 times its book value.

What is the current FCF Yield for Telefonaktiebolaget LM Ericsson (ERIC) as of Mar 02 2026?

As of Mar 02 2026, Telefonaktiebolaget LM Ericsson (ERIC) has a FCF Yield of 10.78%. This means that for every dollar of Telefonaktiebolaget LM Ericsson's market capitalization, the company generates 10.78 cents in free cash flow.

What is the current Forward P/E ratio for Telefonaktiebolaget LM Ericsson (ERIC) as of Mar 02 2026?

As of Mar 02 2026, Telefonaktiebolaget LM Ericsson (ERIC) has a Forward P/E ratio of 15.48. This means the market is willing to pay $15.48 for every dollar of Telefonaktiebolaget LM Ericsson's expected earnings over the next 12 months.

What is the current Forward P/S ratio for Telefonaktiebolaget LM Ericsson (ERIC) as of Mar 02 2026?

As of Mar 02 2026, Telefonaktiebolaget LM Ericsson (ERIC) has a Forward P/S ratio of 1.26. This means the market is valuing ERIC at $1.26 for every dollar of expected revenue over the next 12 months.

ERIC Valuation