Is NYSE:EMR a Good Fit for Dividend Investing?

Last update: Jan 1, 2024

Take a closer look at EMERSON ELECTRIC CO (NYSE:EMR), a stock of interest to dividend investors uncovered by our stock screener. NYSE:EMR excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Evaluating Dividend: NYSE:EMR

To gauge a stock's dividend quality, ChartMill utilizes a Dividend Rating ranging from 0 to 10. This comprehensive assessment considers various dividend aspects, including yield, history, growth, and sustainability. NYSE:EMR has achieved a 7 out of 10:

Compared to an average industry Dividend Yield of 2.44, EMR pays a better dividend. On top of this EMR pays more dividend than 95.35% of the companies listed in the same industry.
EMR has been paying a dividend for at least 10 years, so it has a reliable track record.
EMR has not decreased their dividend for at least 10 years, which is a reliable track record.
9.12% of the earnings are spent on dividend by EMR. This is a low number and sustainable payout ratio.
EMR's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Understanding NYSE:EMR's Health Score

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:EMR, the assigned 7 for health provides valuable insights:

An Altman-Z score of 3.52 indicates that EMR is not in any danger for bankruptcy at the moment.
EMR has a Altman-Z score of 3.52. This is in the better half of the industry: EMR outperforms 70.93% of its industry peers.
EMR has a debt to FCF ratio of 3.94. This is a good value and a sign of high solvency as EMR would need 3.94 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.94, EMR is doing good in the industry, outperforming 79.07% of the companies in the same industry.
EMR has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
A Current Ratio of 2.38 indicates that EMR has no problem at all paying its short term obligations.
EMR has a Quick Ratio of 2.07. This indicates that EMR is financially healthy and has no problem in meeting its short term obligations.
EMR has a Quick ratio of 2.07. This is in the better half of the industry: EMR outperforms 74.42% of its industry peers.

Assessing Profitability for NYSE:EMR

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:EMR was assigned a score of 8 for profitability:

EMR's Return On Assets of 29.92% is amongst the best of the industry. EMR outperforms 98.84% of its industry peers.
With an excellent Return On Equity value of 64.58%, EMR belongs to the best of the industry, outperforming 98.84% of the companies in the same industry.
EMR has a better Return On Invested Capital (6.66%) than 72.09% of its industry peers.
The 3 year average ROIC (11.91%) for EMR is well above the current ROIC(6.66%). The reason for the recent decline needs to be investigated.
Looking at the Profit Margin, with a value of 80.41%, EMR belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
EMR's Profit Margin has improved in the last couple of years.
The Operating Margin of EMR (19.14%) is better than 95.35% of its industry peers.
EMR's Operating Margin has improved in the last couple of years.
EMR has a Gross Margin of 47.05%. This is amongst the best in the industry. EMR outperforms 95.35% of its industry peers.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

For an up to date full fundamental analysis you can check the fundamental report of EMR

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.