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Emerson Electric (EMR) Outpaces Stock Market Gains: What You Should Know

·3 min read

Emerson Electric (EMR) closed the most recent trading day at $83.67, moving +1.74% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.66%. Meanwhile, the Dow gained 0.61%, and the Nasdaq, a tech-heavy index, lost 0.02%.

Prior to today's trading, shares of the maker of process controls systems, valves and analytical instruments had lost 6.05% over the past month. This has lagged the Industrial Products sector's loss of 1.93% and the S&P 500's loss of 3.79% in that time.

Wall Street will be looking for positivity from Emerson Electric as it approaches its next earnings report date. On that day, Emerson Electric is projected to report earnings of $1.39 per share, which would represent year-over-year growth of 14.88%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.31 billion, up 7.39% from the year-ago period.

EMR's full-year Zacks Consensus Estimates are calling for earnings of $5.11 per share and revenue of $19.54 billion. These results would represent year-over-year changes of +24.63% and +7.16%, respectively.

Any recent changes to analyst estimates for Emerson Electric should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.13% higher. Emerson Electric is currently a Zacks Rank #3 (Hold).

Looking at its valuation, Emerson Electric is holding a Forward P/E ratio of 16.11. For comparison, its industry has an average Forward P/E of 16.76, which means Emerson Electric is trading at a discount to the group.

Also, we should mention that EMR has a PEG ratio of 1.91. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Manufacturing - Electronics stocks are, on average, holding a PEG ratio of 1.7 based on yesterday's closing prices.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 139, which puts it in the bottom 45% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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