Read original blog entry
Headquartered in Stockholm, Sweden, LM Ericsson Telephone Company (ERIC) is a multinational company engaged in manufacturing and selling wireless infrastructure equipment for the telecom sector. It is a total network solutions provider, serving wireless and wireline operators, enterprises and consumers.
Ericsson reported slightly higher revenues but lower-than-expected earnings for 3Q08. The company experienced operator consolidation and delays in mobile telecom roll-outs across Western & Eastern Europe, Australia and Japan, which caused its product mix to be more-heavily weighted towards lower-margined products and services.
This, along with costs of integration, reduced the company's overall margins and earnings significantly during the second quarter. Although the company's share price has plummeted after a severe correction, we remain concerned about the near-term outlook for the industry as a whole as competition continues to drive pricing lower.
We continue to rate shares of ERIC a Hold, and have fixed our price target at $7.30 per share.
Udayan Mukherjee contributed to this report.
Read the full analyst report on ERIC
Get real-time market insights and profitable stock recommendations from the team of analysts at Zacks Equity Research. See all todays Analyst Blog entries on Zacks.com.