Financial Review: Franklin Wireless (OTCMKTS:FKWL) versus Telefonaktiebolaget LM Ericsson (publ) (NASDAQ:ERIC)

Franklin Wireless (OTCMKTS:FKWL) and Telefonaktiebolaget LM Ericsson (publ) (NASDAQ:ERIC) are both computer and technology companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, profitability, institutional ownership, risk, valuation, earnings and dividends.

Volatility and Risk

Franklin Wireless has a beta of 0.14, meaning that its share price is 86% less volatile than the S&P 500. Comparatively, Telefonaktiebolaget LM Ericsson (publ) has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings for Franklin Wireless and Telefonaktiebolaget LM Ericsson (publ), as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Franklin Wireless	0	0	0	0	N/A
Telefonaktiebolaget LM Ericsson (publ)	2	1	1	0	1.75

Telefonaktiebolaget LM Ericsson (publ) has a consensus target price of $5.90, suggesting a potential downside of 15.35%. Given Telefonaktiebolaget LM Ericsson (publ)’s higher probable upside, analysts plainly believe Telefonaktiebolaget LM Ericsson (publ) is more favorable than Franklin Wireless.

Profitability

This table compares Franklin Wireless and Telefonaktiebolaget LM Ericsson (publ)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Franklin Wireless	-4.77%	-4.69%	-3.73%
Telefonaktiebolaget LM Ericsson (publ)	-14.13%	11.39%	3.79%

Valuation & Earnings

This table compares Franklin Wireless and Telefonaktiebolaget LM Ericsson (publ)’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Franklin Wireless	$41.68 million	1.13	-$3.76 million	($0.31)	-12.84
Telefonaktiebolaget LM Ericsson (publ)	$249.53 billion	0.09	-$2.49 billion	($0.99)	-7.04

Franklin Wireless has higher earnings, but lower revenue than Telefonaktiebolaget LM Ericsson (publ). Franklin Wireless is trading at a lower price-to-earnings ratio than Telefonaktiebolaget LM Ericsson (publ), indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

18.5% of Franklin Wireless shares are owned by institutional investors. Comparatively, 8.0% of Telefonaktiebolaget LM Ericsson (publ) shares are owned by institutional investors. 29.6% of Franklin Wireless shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Telefonaktiebolaget LM Ericsson (publ) beats Franklin Wireless on 7 of the 13 factors compared between the two stocks.

About Franklin Wireless

Franklin Wireless Corp. provides integrated wireless solutions. The company's products include 5G/4G wireless broadband products, such as wi-fi mobile hotspot, fixed wireless routers, and enterprise gateway CPE; and IoT tracking and connected devices, including smart IoT tracking device, connected car, and home phone connect. It also offers IOT server platform and application, which comprises Pintrac, a cloud based telecom grade server platform; Pintrac Mobile Device Management, an LTE hotspot; Pintrac Pet, a pet tracking application; Pintrac Auto that tracks, locates, and manages vehicles for consumers and businesses; and JEXtream, a cloud based telecom grade server platform for 5G devices and routers that enables enhanced remote management of device functionality. The company directly markets and sells its products to wireless operators, as well as indirectly through strategic partners and distributors located primarily in the North America, the Caribbean and South America, and Asia. Franklin Wireless Corp. was founded in 1981 and is headquartered in San Diego, California.

About Telefonaktiebolaget LM Ericsson (publ)

Telefonaktiebolaget LM Ericsson (publ), together with its subsidiaries, provides mobile connectivity solutions for telcom operators and enterprise customers in various sectors in North America, Europe, Latin America, the Middle East, Africa, North East Asia, South East Asia, Oceania, and India. It operates in four segments: Networks; Cloud Software and Services; Enterprise; and Other. The Networks segment offers radio access network (RAN) solutions for various network spectrum bands, including purpose-built and open RAN-prepared hardware and software. This segment also provides cloud RAN; transport solutions; passive and active antennas; and a range of service portfolios covering network deployment and support. The Cloud Software and Services segment offers core networks, business and operational support systems, network design and optimization, and managed network services. The Enterprise segment offers a global communications platform, including cloud-based unified communications as a service, contact center as a service, and communications platform as a service; enterprise wireless solutions comprising private wireless networks and wireless wan pre-packaged solutions; and technologies and new business solutions, such as mobile financial services, security solutions, and advertising services. The Other segment includes Redbee media that prepares and distributes live and video services for broadcasters, sports leagues, and communications service providers. It offers its services through wholesalers and distributors. The company was formerly known as Allmanna Telefon AB LM Ericsson and changed its name to Telefonaktiebolaget LM Ericsson (publ) in January 1926. Telefonaktiebolaget LM Ericsson (publ) was founded in 1876 and is headquartered in Stockholm, Sweden.