Telefonaktiebolaget LM Ericsson vs Nokia Which Is More Profitable?

Telefonaktiebolaget LM Ericsson and Nokia are two leading telecommunications companies with a long-standing history of competition in the stock market. Both companies have been innovators in the industry, investing heavily in research and development to stay ahead of the curve. Investors often compare the two companies' stocks, analyzing their financial performance, market share, and strategic direction to make informed investment decisions. The dynamic nature of the telecommunications sector makes the stocks of Ericsson and Nokia a compelling topic for investors looking to capitalize on the ever-evolving market trends.

Telefonaktiebolaget LM Ericsson or Nokia?

When comparing Telefonaktiebolaget LM Ericsson and Nokia, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Telefonaktiebolaget LM Ericsson and Nokia.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Telefonaktiebolaget LM Ericsson has a dividend yield of 3.31%, while Nokia has a dividend yield of 3.61%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Telefonaktiebolaget LM Ericsson reports a 5-year dividend growth of 45.52% year and a payout ratio of -667.40%. On the other hand, Nokia reports a 5-year dividend growth of 0.00% year and a payout ratio of 173.43%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Telefonaktiebolaget LM Ericsson P/E ratio at -216.14 and Nokia's P/E ratio at 56.47. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Telefonaktiebolaget LM Ericsson P/B ratio is 3.40 while Nokia's P/B ratio is 1.12.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Telefonaktiebolaget LM Ericsson has seen a 5-year revenue growth of 0.23%, while Nokia's is -0.02%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Telefonaktiebolaget LM Ericsson's ROE at -1.44% and Nokia's ROE at 1.97%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $8.11 for Telefonaktiebolaget LM Ericsson and $4.54 for Nokia. Over the past year, Telefonaktiebolaget LM Ericsson's prices ranged from $4.56 to $8.62, with a yearly change of 89.04%. Nokia's prices fluctuated between $2.94 and $4.95, with a yearly change of 68.37%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.