Telefonaktiebolaget L M Ericsson (LTS:0O87) ROCE %: 16.47% (As of Jun. 2026)

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LTS:0O87 Telefonaktiebolaget L M Ericsson LTS:0O87
61 GF Score
Price kr98.97
GF Value kr71.46
Valuation Significantly Overvalued
! 4 Warning Signs
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What is Telefonaktiebolaget L M Ericsson ROCE %?

Telefonaktiebolaget L M Ericsson LTS:0O87 -11.95% 61 ROCE % is 16.47% as of Jun. 2026. GuruFocus rates LTS:0O87 with a GF Score™ of 61/100 and a GF Value™ of kr71.46 (Significantly Overvalued). The stock has 4 warning signs investors should review.

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. Telefonaktiebolaget L M Ericsson's annualized ROCE % for the quarter that ended in Jun. 2026 was 16.47%.

Telefonaktiebolaget L M Ericsson  (LTS:0O87) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

Telefonaktiebolaget L M Ericsson ROCE % Related Terms

Telefonaktiebolaget L M Ericsson ROCE % Historical Data

* Premium members only.

The historical data trend for Telefonaktiebolaget L M Ericsson's ROCE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Telefonaktiebolaget L M Ericsson ROCE % Chart

Telefonaktiebolaget L M Ericsson Annual Data
Trend Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23 Dec24 Dec25
ROCE %
Get a 7-Day Free Trial Premium Member Only Premium Member Only 18.14 13.80 -10.80 3.74 24.95

Telefonaktiebolaget L M Ericsson Quarterly Data
Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24 Dec24 Mar25 Jun25 Sep25 Dec25 Mar26 Jun26
ROCE % Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 19.86 40.22 27.45 4.56 16.47
LTS:0O87
61GF Score
Telefonaktiebolaget L M Ericsson LTS:0O87
ROCE % is just one metric. See GF Score™, valuation, warning signs, and more.
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Telefonaktiebolaget L M Ericsson ROCE % Calculation

Telefonaktiebolaget L M Ericsson's annualized ROCE % for the fiscal year that ended in Dec. 2025 is calculated as:

ROCE %=EBIT/( (Capital Employed+Capital Employed)/ count )
(A: Dec. 2025 )  (A: Dec. 2024 )(A: Dec. 2025 )
=EBIT/( ( (Total Assets - Total Current Liabilities)+(Total Assets - Total Current Liabilities) )/ count )
(A: Dec. 2025 )  (A: Dec. 2024 )(A: Dec. 2025 )
=41021/( ( (292374 - 131874) + (279223 - 110937) )/ 2 )
=41021/( (160500+168286)/ 2 )
=41021/164393
=24.95 %

Telefonaktiebolaget L M Ericsson's ROCE % of for the quarter that ended in Jun. 2026 is calculated as:

ROCE %=EBIT (1)/( (Capital Employed+Capital Employed)/ count )
(Q: Jun. 2026 )  (Q: Mar. 2026 )(Q: Jun. 2026 )
=EBIT/( ( (Total Assets - Total Current Liabilities)+(Total Assets - Total Current Liabilities) )/ count )
(Q: Jun. 2026 )  (Q: Mar. 2026 )(Q: Jun. 2026 )
=25684/( ( (290393 - 135063) + (287899 - 131327) )/ 2 )
=25684/( ( 155330 + 156572 )/ 2 )
=25684/155951
=16.47 %

(1) Note: The EBIT data used here is four times the quarterly (Jun. 2026) EBIT data.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Frequently Asked Questions Learn more about ROCE % →
What does a ROCE % of 16.47% mean?
Telefonaktiebolaget L M Ericsson (LTS:0O87) has a ROCE % of 16.47% as of Jun. 2026.
Is Telefonaktiebolaget L M Ericsson's ROCE % too high?
Telefonaktiebolaget L M Ericsson's current ROCE % is 16.47%. The Hardware industry median ROCE % is 5.89. Telefonaktiebolaget L M Ericsson's value of 16.47% is 179.9% above this industry median. Overall, Telefonaktiebolaget L M Ericsson has a GF Score™ of 61/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Telefonaktiebolaget L M Ericsson's ROCE % compare to CSCO and CIEN?
Telefonaktiebolaget L M Ericsson's ROCE % of 16.47% can be compared against companies in the Hardware industry. The industry median ROCE % is 5.89. Telefonaktiebolaget L M Ericsson's value of 16.47% is 179.9% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROCE % for a Hardware company?
The median ROCE % among Hardware companies is 5.89, based on 2,452 companies in the industry. Companies in the top quartile (top 25%) have a ROCE % significantly above this median, while those in the bottom quartile fall well below. However, ROCE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Telefonaktiebolaget L M Ericsson's current ROCE % of 16.47% is 179.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROCE % mean?
A high ROCE % can signal that a stock is expensive relative to its fundamentals. For the Hardware industry, the median ROCE % is 5.89 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Telefonaktiebolaget L M Ericsson's current ROCE % is 16.47%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Telefonaktiebolaget L M Ericsson stock overvalued right now?
Based on GuruFocus' analysis, Telefonaktiebolaget L M Ericsson (LTS:0O87) is currently considered Significantly Overvalued. The stock's GF Value™ is kr71.46, compared to a current price of kr98.97 — trading 38.5% above its estimated fair value. The current ROCE % is 16.47% and 179.9% above the Hardware industry median of 5.89. Telefonaktiebolaget L M Ericsson's overall GF Score™ is 61/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROCE % calculated?
ROCE % is calculated from a company's financial statements. For Telefonaktiebolaget L M Ericsson (LTS:0O87), the current ROCE % is 16.47% as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Is Telefonaktiebolaget L M Ericsson (LTS:0O87) Overvalued in 2026?

Based on GuruFocus' analysis, Telefonaktiebolaget L M Ericsson stock appears to be overvalued. The current stock price of kr98.97 is trading 38.5% above its estimated GF Value™ of kr71.46. GuruFocus considers Telefonaktiebolaget L M Ericsson to be Significantly Overvalued.

Key valuation signals for LTS:0O87:

  • ROCE %: 16.47%
  • GF Value™: kr71.46 vs. price of kr98.97 (38.5% above fair value)
  • GF Score™: 61/100 with 4 warning signs
  • Industry Position: 179.9% above the Hardware median

No single metric tells the full story. See the LTS:0O87 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.

Telefonaktiebolaget L M Ericsson Business Description

Address Torshamnsgatan 21, Kista, Stockholm, SWE, SE-164 83
Ericsson is a networking equipment and software provider, primarily selling mobile networking equipment and services to wireless service providers. Ericsson operates in three segments: networks, cloud software and services, and enterprise. While large wireless carriers are its largest customers, Ericsson has expanded its offerings for large enterprises. These products and services include private 5G networking, contact centers as a service, and application performance interfaces. Ericsson aims to combine its 5G network expertise with cloud-native, as-a-service platforms offering a more comprehensive hardware and software package. Ericsson also monetizes its research and development investments by licensing patents to handset manufacturers.
61GF Score

Get the complete analysis for LTS:0O87

ROCE % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

kr98.97
Price
kr71.46
GF Value