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Will ERIC Stock Gain From Partnership With Telenor Microfinance Bank?

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Ericsson (ERIC - Free Report) recently announced that it has collaborated with Telenor Microfinance Bank (“TMB”) to upgrade the digital financial capabilities of easypaisa. Based in Pakistan, easypaisa is a subsidiary of TMB and one of the prominent digital service providers in the country, serving millions of users every day.

Digital banking services are growing in prominence across industries, owing to several advantages offered compared with legacy banking system. 24/7 accessibility and remarkable flexibility enable users to complete payments from home or on the go. In addition to convenience for customers, the system also lowers operating costs for financial institutions. However, security threats, scalability of underlying technology infrastructure, applications scalability to accommodate the growing number of users and transactions without performance degradation are major challenges. Limited digital literacy in certain areas can also increase the digital divide.

By incorporating the latest cloud-native technologies through Ericsson’s Mobile Financial Services platform, easypaisa is aiming to counter these challenges. The solution’s open architecture with extensive APIs and enhanced functionalities will enable easypaisa to scale its operation and efficiently support the growing number of customers with ease. The upgrades will bolster the fintech’s innovation capabilities, delivering faster, more secure, personalized and user-friendly financial services.

Will This Collaboration Drive the Performance of ERIC’s Shares?

Ericsson’s Mobile Financial Services have been gaining significant traction worldwide. The solution is used by around 114 million active users across 24 countries. This facilitates more than 36 billion transactions totaling $501 billion annually.

The digital banking services market is projected to grow exponentially in the coming years. Recognizing this trend, Ericsson is undertaking various initiatives to augment its financial services portfolio. The company recently collaborated with INFORM, an industry leader in Anti-Money Laundering and Fraud Management Solutions to enhance cybersecurity for financial services.

Ericsson’s recent venture with TMB underscores growing credibility of the company’s product suite in the rapidly changing fintech landscape. This bodes well for long-term growth.

ERIC Stock’s Price Performance

Shares of Ericsson have gained 61.8% in the past year compared with the industry’s 54.1% growth.

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ERIC’s Zacks Rank and Key Picks

Ericsson currently carries a Zacks Rank #4 (Sell).

Arista Networks, Inc. (ANET - Free Report) carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the last reported quarter, it delivered an earnings surprise of 8.25%. ANET is engaged in providing cloud networking solutions for data centers and cloud computing environments. The company offers 10/25/40/50/100 gigabit Ethernet switches and routers optimized for next-generation data center networks.

Ubiquiti Inc. (UI - Free Report) carries a Zacks Rank # 2 at present. The company offers a comprehensive portfolio of networking products and solutions for service providers and enterprises.

UI’s excellent global business model, which is flexible and adaptable to evolving changes in markets, helps it to beat challenges and maximize growth. The company’s effective management of its strong global network of more than 100 distributors and master resellers improved its  visibility for future demand and inventory management techniques.

Workday Inc. (WDAY - Free Report) carries a Zacks Rank #2 at present. In the last reported quarter, it delivered an earnings surprise of 7.36%.

WDAY is a leading provider of enterprise-level software solutions for financial management and human resource domains. The company’s cloud-based platform combines finance and HR in a single system that makes the process easier for organizations to provide analytical insights and decision support.


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