(News Bulletin 247) – After its 12% plunge last Friday, the Ericsson share continued to fall and dropped more than 3% on Monday on the Stockholm Stock Exchange in the wake of a downgrade by Barclays.
Citing a ‘tougher’ environment for telecoms equipment makers, confirmed in their view by Nokia’s recent warning, analysts at the UK bank have decided to shift their advice on the stock from ‘overweight’ to ‘online weight’, with a price target lowered from 60 to 55 Swedish crowns.
“We feel that we are benefiting from less visibility as to a possible recovery in activity during the second half of the financial year,” explains Barclays.
“We no longer expect a significant recovery in spending (by operators, editor’s note) in the United States during the second part of the year and only envisage a timid improvement in 2024”, continues the London establishment.
Same story at Deutsche Bank, which this morning lowered its target from 60 to 55 crowns while maintaining its recommendation to ‘hold’ on the value.
“The prospect of a recovery in activity in the United States is again postponed, while the scenario of a vigorous rebound in 2024 seems very optimistic”, underlines the research office.
From the analyst’s point of view, Ericsson’s difficulties only illustrate the loss of momentum in 5G deployments after the frenetic activity that had characterized the last few exercises.
Ericsson shares plunged 12% on Friday following quarterly results deemed disappointing, accompanied by forecasts for the third quarter deemed uninspiring.
Copyright (c) 2023 News Bulletin 247. All rights reserved.
I have over 8 years of experience working in the news industry. I have worked as a reporter, editor, and now managing editor at 247 News Agency. I am responsible for the day-to-day operations of the news website and overseeing all of the content that is published. I also write a column for the website, covering mostly market news.