Telefonaktiebolaget LM Ericsson (publ) (ERIC) Financial Ratios
30 years of historical data (1996–2025) · Technology · Communication Equipment
EV/EBITDA
↑
8.93
↑+792% vs avg
5yr avg: 1.00
30Y Low0.4·High5.5
P/FCF
↑
11.75
↑+544% vs avg
5yr avg: 1.82
30Y Low0.6·High33.8
P/B Ratio
↓
3.31
↑+1186% vs avg
5yr avg: 0.26
30Y Low0.1·High1.8
ROE
↑
26.3%
↓+191% vs avg
5yr avg: 9.0%
30Y Low-26%·High28%
Debt/EBITDA
↑
1.22
↓-20% vs avg
5yr avg: 1.52
30Y Low0.4·High2.3
Percentile shows where the current value sits in 30-year historical distribution. Sparklines show 5-year trend.
ERIC Valuation Multiples
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
Telefonaktiebolaget LM Ericsson (publ) trades at 13.6x earnings, 96% below its 5-year average of 336.8x, sitting at the 96th percentile of its historical range. Compared to the Technology sector median P/E of 29.0x, the stock trades at a discount of 53%. On a free-cash-flow basis, the stock trades at 11.8x P/FCF, 544% above the 5-year average of 1.8x.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $35.0B | $32.3B | $26.9B | $21.0B | $19.5B | $36.2B | $39.7B | $29.1B | $29.4B | $22.2B | $19.3B |
| Enterprise Value | $35.2B | $34.4B | $28.6B | $40.1B | $23.3B | $23.3B | $35.6B | $31.6B | $24.1B | $19.3B | $8.9B |
| P/E Ratio → | 13.63 | 1.21 | 1343.33 | — | 1.03 | 1.52 | 2.55 | 13.72 | — | — | 10.60 |
| P/S Ratio | 1.51 | 0.14 | 0.10 | 0.08 | 0.07 | 0.15 | 0.19 | 0.13 | 0.13 | 0.11 | 0.08 |
| P/B Ratio | 3.31 | 0.29 | 0.29 | 0.22 | 0.15 | 0.34 | 0.47 | 0.37 | 0.33 | 0.22 | 0.14 |
| P/FCF | 11.75 | 1.13 | 0.59 | 5.70 | 0.73 | 0.97 | 1.83 | 2.58 | 5.30 | 3.95 | 2.29 |
| P/OCF | 10.81 | 1.04 | 0.56 | 3.08 | 0.62 | 0.88 | 1.54 | 1.80 | 3.05 | 2.36 | 1.29 |
P/E links to full P/E history page with 30-year chart
ERIC EV Ratios
Enterprise-value multiples — capital-structure-neutral measures of total business value
Telefonaktiebolaget LM Ericsson (publ)'s enterprise value stands at 8.9x EBITDA, 792% above its 5-year average of 1.0x. The Technology sector median is 16.7x, placing the stock at a 46% discount on an enterprise-value basis.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 0.15 | 0.11 | 0.16 | 0.08 | 0.10 | 0.17 | 0.14 | 0.11 | 0.10 | 0.04 |
| EV / EBITDA | 8.93 | 0.91 | 1.44 | 1.51 | 0.59 | 0.56 | 1.09 | 1.13 | 1.55 | — | 0.37 |
| EV / EBIT | 10.96 | 0.89 | 4.28 | — | 0.87 | 0.71 | 1.34 | 2.87 | 48.13 | — | 1.48 |
| EV / FCF | — | 1.21 | 0.62 | 10.90 | 0.87 | 0.63 | 1.64 | 2.80 | 4.34 | 3.43 | 1.06 |
ERIC Profitability
Margins and return-on-capital ratios measuring operating efficiency
Telefonaktiebolaget LM Ericsson (publ) earns an operating margin of 13.8%. Operating margins have expanded from 6.8% to 13.8% over the past 3 years, signaling improving operational efficiency. ROE of 26.3% indicates solid capital efficiency. ROIC of 22.3% represents excellent returns on invested capital.
Margins
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 48.1% | 48.1% | 44.9% | 39.6% | 41.8% | 43.5% | 40.6% | 37.5% | 35.2% | 24.6% | 30.6% |
| Operating Margin | 13.8% | 13.8% | 3.6% | 6.8% | 11.3% | 14.0% | 12.7% | 9.7% | 4.9% | -6.9% | 6.0% |
| Net Profit Margin | 12.0% | 12.0% | 0.0% | -10.0% | 6.9% | 9.8% | 7.5% | 1.0% | -3.1% | -15.9% | 0.8% |
Return on Capital
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 26.3% | 26.3% | 0.0% | -22.0% | 15.9% | 24.9% | 18.9% | 2.5% | -7.2% | -26.5% | 1.3% |
| ROA | 9.3% | 9.3% | 0.0% | -7.6% | 5.8% | 8.2% | 5.7% | 0.8% | -2.5% | -11.4% | 0.6% |
| ROIC | 22.3% | 22.3% | 6.6% | 10.2% | 20.3% | 29.5% | 24.2% | 19.1% | 8.9% | -9.1% | 8.2% |
| ROCE | 18.4% | 18.4% | 5.4% | 8.8% | 16.1% | 20.3% | 16.6% | 13.1% | 6.4% | -7.6% | 7.3% |
ERIC Leverage & Debt
Solvency and debt-coverage ratios — lower is generally safer
Telefonaktiebolaget LM Ericsson (publ) carries a Debt/EBITDA ratio of 1.2x, which is manageable (59% below the sector average of 2.9x). Net debt stands at $2.1B ($46.0B total debt minus $43.9B cash). Interest coverage of 10.7x signals virtually no risk of debt distress — earnings comfortably cover interest obligations.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.42 | 0.42 | 0.49 | 0.56 | 0.32 | 0.38 | 0.46 | 0.58 | 0.38 | 0.34 | 0.19 |
| Debt / EBITDA | 1.22 | 1.22 | 2.30 | 2.05 | 1.05 | 0.98 | 1.21 | 1.66 | 2.17 | — | 1.13 |
| Net Debt / Equity | — | 0.02 | 0.02 | 0.20 | 0.03 | -0.12 | -0.05 | 0.03 | -0.06 | -0.03 | -0.07 |
| Net Debt / EBITDA | 0.06 | 0.06 | 0.08 | 0.72 | 0.10 | -0.31 | -0.13 | 0.09 | -0.34 | — | -0.43 |
| Debt / FCF | — | 0.07 | 0.04 | 5.20 | 0.14 | -0.35 | -0.19 | 0.21 | -0.96 | -0.52 | -1.23 |
| Interest Coverage | 10.73 | 10.73 | 2.53 | 5.17 | 15.74 | 18.74 | 13.32 | 9.24 | 5.16 | -9.66 | 8.16 |
ERIC Liquidity & Efficiency
Short-term solvency ratios and asset-utilisation metrics
A current ratio of 1.29x means Telefonaktiebolaget LM Ericsson (publ) can comfortably meet its short-term obligations, though there is limited excess liquidity. The current ratio has improved from 1.20x to 1.29x over the past 3 years.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.29 | 1.29 | 1.17 | 1.20 | 1.19 | 1.38 | 1.31 | 1.32 | 1.45 | 1.54 | 1.85 |
| Quick Ratio | 1.08 | 1.08 | 0.96 | 0.92 | 0.88 | 1.10 | 1.06 | 1.05 | 1.19 | 1.28 | 1.52 |
| Cash Ratio | 0.51 | 0.51 | 0.43 | 0.35 | 0.32 | 0.53 | 0.44 | 0.44 | 0.41 | 0.43 | 0.53 |
| Asset Turnover | — | 0.80 | 0.87 | 0.81 | 0.79 | 0.80 | 0.76 | 0.81 | 0.79 | 0.74 | 0.82 |
| Inventory Turnover | 4.92 | 4.92 | 5.25 | 4.17 | 3.51 | 3.89 | 4.31 | 4.56 | 4.76 | 5.81 | 5.18 |
| Days Sales Outstanding | — | 104.12 | 95.87 | 104.33 | 101.69 | 104.20 | 121.36 | 113.31 | 144.07 | 153.41 | 137.98 |
ERIC Shareholder Yields
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Telefonaktiebolaget LM Ericsson (publ) returns 2.5% to shareholders annually primarily through dividends. The payout ratio of 33.6% is conservative, leaving significant room for dividend growth or reinvestment. The earnings yield of 7.3% (inverse of P/E) provides a useful comparison to bond yields when assessing the stock's relative attractiveness to fixed income.
Dividends
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 2.5% | 27.8% | 35.0% | 40.7% | 43.2% | 20.0% | 13.4% | 14.7% | 12.0% | 15.1% | 66.8% |
| Payout Ratio | 33.6% | 33.6% | 44984.3% | — | 44.5% | 30.4% | 34.3% | 200.2% | — | — | 702.7% |
Total Shareholder Return Metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 7.3% | 82.9% | 0.1% | — | 97.1% | 66.0% | 39.2% | 7.3% | — | — | 9.4% |
| FCF Yield | 8.5% | 88.4% | 170.8% | 17.5% | 136.9% | 102.9% | 54.8% | 38.7% | 18.9% | 25.3% | 43.7% |
| Buyback Yield | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% | 0.1% | 0.1% |
| Total Shareholder Yield | 2.5% | 27.8% | 35.0% | 40.7% | 43.2% | 20.0% | 13.4% | 14.7% | 12.0% | 15.2% | 66.9% |
| Shares Outstanding | — | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B | $3.3B |
Peer Comparison
Compare ERIC with 10 similar companies in its peer group
| Company | Market Cap | P/E | EV/EBITDA | P/FCF | Gross Margin | Op Margin | ROE | ROIC | Debt/EBITDA |
|---|---|---|---|---|---|---|---|---|---|
 ERICYou | $35B | 13.6 | 8.9 | 11.8 | 48.1% | 13.8% | 26.3% | 22.3% | 1.2 |
 NOK | $77B | 106.9 | 35.3 | 47.8 | 43.5% | 3.9% | 3.1% | 3.0% | 2.7 |
 CSCO | $471B | 46.9 | 33.6 | 35.5 | 64.9% | 20.8% | 22.1% | 13.0% | 1.9 |
 HPE | $63B | -1063.0 | 18.5 | 100.1 | 28.8% | 4.8% | 0.2% | 3.4% | 5.5 |
 VIAV | $11B | 314.5 | 83.7 | 176.0 | 56.8% | 6.5% | 4.8% | 5.5% | 5.2 |
 CIEN | $61B | 503.8 | 135.5 | 91.1 | 42.0% | 6.5% | 4.4% | 6.9% | 3.5 |
 ADTN | $1B | -26.6 | 17.9 | 12.5 | 38.3% | -1.4% | -8.5% | -1.7% | 3.2 |
 CALX | $2B | 146.0 | 60.3 | 21.2 | 56.8% | 2.1% | 2.2% | 2.1% | 0.7 |
 COMM | $4B | -10.0 | 18.2 | 15.9 | 31.8% | 7.9% | — | 3.7% | 13.4 |
 QCOM | $238B | 45.1 | 17.7 | 18.6 | 55.4% | 27.9% | 23.3% | 29.1% | 1.2 |
 MRVL | $272B | 101.2 | 104.2 | 194.6 | 51.0% | 16.3% | 19.3% | 6.0% | 1.8 |
| Technology Median | — | 29.0 | 16.7 | 19.2 | 48.8% | 0.2% | 1.6% | 2.7% | 2.9 |
Peer selection based on competitive and market overlap. Compare multiple stocks →
Download Financial Ratios Data
Includes 30+ ratios · 30 years · Updated daily
Consensus-Based Analysis Tools
Full Stock Analysis
Deep dive into ERIC consensus models and risk factors.
View Analysis
Intrinsic Valuation
DCF models, multiple analysis, and analyst estimates.
Check Valuation
Historical Returns
10-year return with dividends reinvested.
Calculate
DCA Calculator
See how regular investing compounds over time.
Run Numbers
Peer Comparison
Compare growth, multiples, and margins vs sector.
Compare
ERIC — Frequently Asked Questions
Quick answers to the most common questions about buying ERIC stock.
What is Telefonaktiebolaget LM Ericsson (publ)'s P/E ratio?
Telefonaktiebolaget LM Ericsson (publ)'s current P/E ratio is 13.6x. The historical average is 4.2x. This places it at the 96th percentile of its historical range.
What is Telefonaktiebolaget LM Ericsson (publ)'s EV/EBITDA?
Telefonaktiebolaget LM Ericsson (publ)'s current EV/EBITDA is 8.9x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 1.3x.
What is Telefonaktiebolaget LM Ericsson (publ)'s ROE?
Telefonaktiebolaget LM Ericsson (publ)'s return on equity (ROE) is 26.3%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 7.3%.
Is ERIC stock overvalued?
Based on historical data, Telefonaktiebolaget LM Ericsson (publ) is trading at a P/E of 13.6x. This is at the 96th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
What is Telefonaktiebolaget LM Ericsson (publ)'s dividend yield?
Telefonaktiebolaget LM Ericsson (publ)'s current dividend yield is 2.46% with a payout ratio of 33.6%.
What are Telefonaktiebolaget LM Ericsson (publ)'s profit margins?
Telefonaktiebolaget LM Ericsson (publ) has 48.1% gross margin and 13.8% operating margin. Operating margin between 10-20% is typical for established companies.
How much debt does Telefonaktiebolaget LM Ericsson (publ) have?
Telefonaktiebolaget LM Ericsson (publ)'s Debt/EBITDA ratio is 1.2x, indicating moderate leverage. A ratio below 2x is generally considered financially healthy.