Stock fact sheet · data as of
Telefonaktiebolaget LM Ericsson (publ) (ERIC): fair value, margin of safety and Wheel Score
Technology · Communication Equipment · Sweden · ADR · Defensive
Is ERIC undervalued?
At 10.71 (close of 16 Oct 2026), ERIC trades 74% below the GLS average fair value of 41.17. That average comes from 9 models run on the latest filings, and 4 of them land above the current price. Margins of safety over 30% are the exception rather than the rule across the ~7,400 stocks we value each night, so the number earns Telefonaktiebolaget LM Ericsson (publ) the full Value points in the Wheel Score - and a closer look at what the market is pricing in.
There is a wide gap between GLS Growth (0.2365) and 10 Cap (196.85). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.
The nightly engine files ERIC under Defensive: a low beta, a dividend and positive earnings.
Nine valuation models for ERIC
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 8.37 | -22% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 72.50 | +577% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 7.93 | -26% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 0.8216 | -92% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 0.2365 | -98% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 196.85 | +1738% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 31.25 | +192% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 44.14 | +312% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 8.45 | -21% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -7.83 | -173% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 9.00 | -16% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Telefonaktiebolaget LM Ericsson (publ) scores 8 of 9 on the Piotroski F-score, the nine yes/no tests of profitability, leverage and efficiency on the latest annual accounts - a strong reading that passes the Sunday Scan's "6 or more" rule with room to spare. A GLS Moat score of 4.1/10 is a weak reading: the ten-year history the score grades (revenue, EPS, book value, margins, cash flow, share count, ROIC) has not been steady, so the Moat part of the Wheel Score contributes little.
Returns on capital are high - ROIC 17.2%, ROE 24.4%, ROA 9.6% - with debt at 0.42 times equity and a free-cash-flow yield of 9.1%.
The dividend yield is 2.86% at a payout ratio of 40%; for a wheel trader holding assigned shares the dividend adds to the covered-call premium, and the ex-dividend date is worth knowing before a call is sold. Revenue comes mainly from Services 39%, Hardware 37%, Software 23% (fiscal year FY2025).
Institutional ownership scores 1/10, insider activity 5/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 8 / 9 | ROIC | 17.2% |
|---|---|---|---|
| GLS Moat | 4.1 / 10 | ROE | 24.4% |
| Debt / equity | 0.42 | ROA | 9.6% |
| Free-cash-flow yield | 9.1% | Payout ratio | 40% |
| Institutions | 1 / 10 | Insiders · Congress | 5 · 5 / 10 |
Wheel Score 86: Prime
With a Wheel Score of 86, Telefonaktiebolaget LM Ericsson (publ) sits in the Prime band - price, quality and premium all line up for the wheel strategy. The parts: Value 25/25, Health 18/20, Moat 6/15, Premium 17/20, Stability 20/20. A high score is a ranking, not a signal: it says nothing about timing, the earnings date or your position size.
Implied volatility is 32% on the near-the-money contracts 20-60 days out: some premium, but under the 35-60% range the Wheel Score pays full marks for (17 of 20 points). The option chain is deep: 80,744 contracts of open interest across all expiries, which means tight fills at most strikes.
Volume runs at 41.0M shares a day on a market cap of $34.8B, with a beta of 0.51 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score gives that 20 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 25 / 25 | 74% margin of safety | |
| Health | 18 / 20 | Piotroski 8/9 | |
| Moat | 6 / 15 | moat 4.1/10 | |
| Premium | 17 / 20 | implied volatility 32% | |
| Stability | 20 / 20 | 41.0M shares/day, $34.8B cap, beta 0.51 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
No upcoming earnings date is recorded for ERIC in the nightly calendar.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Communication Equipment
The 12 companies below are the closest to Telefonaktiebolaget LM Ericsson (publ) by market cap within the Communication Equipment industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| UI Ubiquiti Inc. | 605.51 | 354.32 | -71% | 33No options | $36.7B |
| CIEN Ciena Corporation | 356.52 | 138.15 | -158% | 63Fair | $50.6B |
| NOK Nokia Oyj | 9.57 | 3.58 | -168% | 61Fair | $51.7B |
| ZBRA Zebra Technologies Corporation | 376.88 | 227.01 | -66% | 60Fair | $17.8B |
| MSI Motorola Solutions, Inc. | 456.27 | 329.24 | -39% | 62Fair | $75.5B |
| LITE Lumentum Holdings Inc. | 869.54 | 100.02 | -769% | 45Weak | $78.8B |
| VIAV Viavi Solutions Inc. | 38.55 | 7.64 | -405% | 45Weak | $9.5B |
| VSAT Viasat, Inc. | 61.73 | 65.02 | +5% | 45Weak | $8.5B |
| AAOI Applied Optoelectronics, Inc. | 83.73 | - | - | 43Weak | $7.1B |
| BDC Belden Inc. | 104.22 | 100.11 | -4% | 72Good | $4.1B |
| ONDS Ondas Holdings Inc. | 6.35 | 9.04 | +30% | 45Weak | $3.7B |
| EXTR Extreme Networks, Inc. | 22.40 | 6.17 | -263% | 59Fair | $3.0B |
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Start free See the Sunday ScanQuestions about ERIC
Is ERIC undervalued right now?
By the GLS models, yes: at 10.71 the stock is 74% below the average fair value of 41.17 (data as of 16 Oct 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of ERIC and what does it mean?
ERIC scores 86 out of 100 (Prime). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for ERIC?
41.17 per share as of 16 Oct 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Telefonaktiebolaget LM Ericsson (publ) report earnings next?
No upcoming earnings date is recorded for ERIC in our calendar as of 16 Oct 2026; the Calendars page is refreshed every morning.
Does ERIC have listed options, and how liquid are they?
Yes. The nightly snapshot found 202 listed contracts with 80,744 open interest across all expiries and implied volatility of 32% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.