Ericsson (ERIC) Hits Fresh High: Is There Still Room to Run?

Core Viewpoint - Ericsson has shown strong stock performance, with a 19.5% increase over the past month and a new 52-week high of $11.38, outperforming both the Zacks Computer and Technology sector and the Zacks Wireless Equipment industry [1] Financial Performance - Ericsson has a consistent record of positive earnings surprises, having met or exceeded earnings consensus estimates in the last four quarters. In the latest earnings report on January 23, 2026, the company reported EPS of $0.27, beating the consensus estimate of $0.23, and exceeded revenue estimates by 4.74% [2] - For the current fiscal year, Ericsson is projected to earn $0.68 per share on revenues of $25.73 billion, reflecting no change in EPS and a 6.54% increase in revenues. For the next fiscal year, earnings are expected to rise to $0.71 per share on revenues of $26.28 billion, indicating year-over-year growth of 4.36% in EPS and 2.12% in revenues [3] Valuation Metrics - Despite reaching a 52-week high, valuation metrics suggest that Ericsson may still have room for growth. The stock trades at 16.6 times current fiscal year EPS estimates, significantly lower than the peer industry average of 32 times. On a trailing cash flow basis, it trades at 11.7 times compared to the peer group's average of 17.6 times. The PEG ratio stands at 1.96, positioning Ericsson favorably among value investors [7] Style Scores and Zacks Rank - Ericsson holds a Value Score of A, a Growth Score of A, and a Momentum Score of B, resulting in a combined VGM Score of A, indicating strong potential for value investors [6] - The stock currently has a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts. This aligns with the recommendation for investors to select stocks with Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, suggesting that Ericsson shares may have further upside potential in the near term [8]