Ericsson Stock Looks Set To Bounce Back Strongly After A 30% Drop Last Month
Ericsson stock (NASDAQ: ERIC) is down almost 30% in the past month (21 trading days), massively underperforming the S&P 500 which was down around 3% over this period. ERIC’s most recent FY ’21 earnings saw revenue unchanged at $24.7 billion from FY ’20. However, a slower rise in COGS and operating expenses saw gross margins rise from 40.3% to 43.4% over this period, and operating margins increased from 12% to 13.7%. This boosted net income and saw EPS rise from $0.56 in FY ’20 to $0.72 in FY ’21.
Now, is ERIC stock set to continue its underperformance or could we expect a bounce back? We believe that there is a more than 90% 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.
- What’s Next For Ericsson Stock?
- Down 16% This Year Amid A Weak Demand In The U.S., What Lies Ahead For Ericsson Stock?
- Is Ericsson Stock A Buy Despite Lull In North America?
- Is Ericsson Stock Good Value At $6?
- Can Ericsson Recover From Its 9.2% Drop Over The Past Two Weeks?
- Forecast Of The Day: Ericsson Managed Services Revenue
Twenty-One Day: ERIC -28%, vs. S&P500 -2.5%; Underperformed market
(<1% likelihood event; 100% probability of rise over next 21 days)
- ERIC stock lost 28% the last twenty-one trading days (one month), compared to a broader market (S&P500) drop of 2.5%
- A change of -28% or more over twenty-one trading days is a <1% likelihood event, which has occurred just 10 times out of 2515 in the last 10 years
- Of these 10 instances, the stock has seen a positive movement over the next twenty-one trading days on 10 occasions
- This points to a 100% probability for the stock rising over the next twenty-one trading days
Ten Day: ERIC 11%, vs. S&P500 -0.1%; Outperformed market
(4% likelihood event; 47% probability of rise over next 10 days)
- ERIC stock gained 11% over the last ten trading days (two weeks), compared to a broader market (S&P500) drop of 0.1%
- A change of 11% or more over ten trading days is a 4% likelihood event, which has occurred 95 times out of 2516 in the last 10 years
- Of these 95 instances, the stock has seen a positive movement over the next ten trading days on 45 occasions
- This points to a 47% probability for the stock rising over the next ten trading days
Five Day: ERIC 6.5%, vs. S&P500 2.3%; Outperformed market
(6% likelihood event; 41% probability of rise over next five days)
- ERIC stock gained 6.5% over a five-day trading period ending 3/16/2022, compared to the broader market (S&P500) which was up around 2.3% over this period.
- A change of 6.5% or more over five trading days (one week) is a 6% likelihood event, which has occurred 159 times out of 2516 in the last 10 years
- Of these 159 instances, the stock has seen a positive movement over the next five trading days on 65 occasions
- This points to a 41% probability for the stock rising over the next five trading days
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since the end of 2016.
| Returns | Mar 2022 MTD [1] |
2022 YTD [1] |
2017-22 Total [2] |
| ERIC Return | -3% | -17% | 54% |
| S&P 500 Return | 0% | -9% | 95% |
| Trefis MS Portfolio Return | -1% | -11% | 251% |
[1] Month-to-date and year-to-date as of 3/17/2022
[2] Cumulative total returns since the end of 2016
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