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Ericsson stock (NASDAQ: ERIC) is down 12% in just one month (21 trading days), completely underperforming the S&P 500 which was up just a little over 3%. If you look at the change over the last five and ten days, too, the stock has returned -6.5% and -8.3%, respectively, thus having underperformed the market on both occasions. Ericsson, a Swedish multinational networking and telecommunications company, reported a drop in sales in its recent Q3 2021 earnings in October, with revenue dropping to $6.27 billion from $6.4 billion in Q3 ’20. However, gross margins (43.1% to 44%) and operating margins (15% to 15.7%) saw an improvement, leading to a rise in EPS from $0.18 to $0.19 over this period. Additionally, this week, Ericsson agreed to acquire Vonage, a cloud-based telecom company, for $21 per share in cash, in a deal valued at close to $6.2 billion. Vonage’s board unanimously approved the deal, and this acquisition would enable Ericsson to build on its global expansion in wireless enterprise.

Now, is Ericsson stock set to drop further or could we expect a bounce back? We believe that there is a 56% chance of a rise in ERIC stock over the next month (21 trading days) based on our machine learning analysis of trends in the stock price over the last ten years. See our analysis on ERIC Stock Chance of Rise. For details about Ericsson’s revenues, see Ericsson Revenues: How Does ERIC Make Money?

Twenty-One Day: ERIC -12%, vs. S&P500 3.2%; Underperformed market

(4% likelihood event; 56% probability of rise over next 21 days)

  • ERIC stock dropped 12% the last twenty-one trading days (one month), compared to a broader market (S&P500) rise of 3.2%
  • A change of -12% or lower over twenty-one trading days is a 4% likelihood event, which has occurred 101 times out of 2515 in the last 10 years
  • Of these 101 instances, the stock has seen a positive movement over the next twenty-one trading days on 57 occasions
  • This points to a 56% probability for the stock rising over the next twenty-one trading days

Ten Day: ERIC -8.3%, vs. S&P500 -0.3%; Underperformed market

(6% likelihood event; 61% probability of rise over next 10 days)

  • ERIC stock dropped 8.3% over the last ten trading days (two weeks), compared to broader market (S&P500) drop of 0.3%
  • A change of -8.3% or lower over ten trading days is a 6% likelihood event, which has occurred 147 times out of 2516 in the last 10 years
  • Of these 147 instances, the stock has seen a positive movement over the next ten trading days on 89 occasions
  • This points to a 61% probability for the stock rising over the next ten trading days

Five Day: ERIC -6.5%, vs. S&P500 0.03%; Underperformed market

(4% likelihood event; 57% probability of rise over next five days)

  • ERIC stock dropped 6.5% over a five-day trading period ending 11/22/2021, compared to the broader market (S&P500) rise of 0.03%
  • A change of -6.5% or lower over five trading days (one week) is a 4% likelihood event, which has occurred 107 times out of 2516 in the last ten years
  • Of these 107 instances, the stock has seen a positive movement over the next five trading days on 61 occasions
  • This points to a 57% probability for the stock rising over the next five trading days

 

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Trefis Team

Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform dashboards.trefis.com) helps you understand how a company's products, that you touch, read, or hear about everyday, impact its stock price. Surprisingly, the founders of Trefis discovered that along with most other people they just did not understand even the seemingly familiar companies around them: Apple, Google, Coca Cola, Walmart, GE, Ford, Gap, and others. This might include you though you may have invested money in these companies, or may have been working with one of them for years as an employee, or have consulted with them as an expert for a long time. You can play with assumptions, or try scenarios, as-well-as ask questions to other users and experts. The platform uses extensive data to show in a single snapshot what drives the value of a company's business. Trefis is currently used by hundreds of thousands of investors, company employees, and business professionals.

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