This 5G Stock Could Soon Become Cheaper
If you're looking for exposure to 5G, you should probably add LM Ericsson (NASDAQ: ERIC) to your watchlist. Despite the coronavirus-induced uncertainties, the Swedish telecom vendor maintained its 2020 and 2022 goals thanks to the strength of its 5G portfolio. The stock doesn't represent a bargain, though. But patient investors should wait for next-quarter earnings as the market may not welcome some short-term headwinds.
First-quarter results confirmed the importance of 5G for Ericsson. Revenue increased by 2% -- but down 2% at constant currency -- to $4.93 billion (converted to U.S. dollars from Swedish Kronas using a $1 to 10.1 SEK exchange rate on April 23).
That weak result was driven by the 6% revenue drop to $720 million in the company's digital services segment (solutions and services for telecommunication providers). In addition to some delayed installations because of the coronavirus pandemic, reduced sales of services and legacy hardware had a negative impact on that segment.
Source Fool.com
