(News Bulletin 247) – Oddo BHF reaffirms its ‘underperforming’ opinion on Ericsson with an adjusted price target of 50 to 45 Swedish crowns, after a disappointing quarterly publication on the group’s outlook and a warning from its peer Nokia , last Friday.

“This sector has historically been undervalued, in our view, due to the inability of major OEMs to consistently translate waves of 3G and 4G and now 5G growth into margins and cash generation,” notes the analyst.

“We prefer to stay away from the telecom equipment sector given the current context even if the valuation is extremely low for the two players”, judges Oddo BHF, for whom the sector could remain poorly valued.

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