EMERSON ELECTRIC CO (EMR) Stock Fundamental Analysis
USA - NYSE:EMR - US2910111044 - Common Stock
129.28 USD
+0.39 (+0.3%)
129.28 USD
0 (0%)
Taking everything into account, EMR scores 6 out of 10 in our fundamental rating. EMR was compared to 92 industry peers in the Electrical Equipment industry. While EMR has a great profitability rating, there are some minor concerns on its financial health. EMR has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year EMR was profitable.
EMR had a positive operating cash flow in the past year.
EMR had positive earnings in each of the past 5 years.
In the past 5 years EMR always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 6.24%, EMR belongs to the best of the industry, outperforming 81.72% of the companies in the same industry.
The Return On Equity of EMR (13.35%) is better than 84.95% of its industry peers.
Looking at the Return On Invested Capital, with a value of 8.37%, EMR is in the better half of the industry, outperforming 79.57% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for EMR is below the industry average of 10.15%.
The 3 year average ROIC (5.88%) for EMR is below the current ROIC(8.37%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.24% | ||
| ROE | 13.35% | ||
| ROIC | 8.37% |
ROA(3y)14.81%
ROA(5y)12.47%
ROE(3y)34.72%
ROE(5y)30.17%
ROIC(3y)5.88%
ROIC(5y)8.65%
1.3 Margins
EMR's Profit Margin of 14.92% is amongst the best of the industry. EMR outperforms 90.32% of its industry peers.
EMR's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 19.03%, EMR belongs to the best of the industry, outperforming 95.70% of the companies in the same industry.
EMR's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 52.70%, EMR belongs to the top of the industry, outperforming 95.70% of the companies in the same industry.
EMR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.03% | ||
| PM (TTM) | 14.92% | ||
| GM | 52.7% |
OM growth 3Y-7.28%
OM growth 5Y-3.77%
PM growth 3Y-3.78%
PM growth 5Y-2.16%
GM growth 3Y6.99%
GM growth 5Y3.61%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), EMR is creating some value.
Compared to 1 year ago, EMR has less shares outstanding
Compared to 5 years ago, EMR has less shares outstanding
The debt/assets ratio for EMR has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.88 indicates that EMR is not in any danger for bankruptcy at the moment.
The Altman-Z score of EMR (3.88) is better than 70.97% of its industry peers.
The Debt to FCF ratio of EMR is 5.19, which is a neutral value as it means it would take EMR, 5.19 years of fcf income to pay off all of its debts.
EMR has a better Debt to FCF ratio (5.19) than 75.27% of its industry peers.
A Debt/Equity ratio of 0.42 indicates that EMR is not too dependend on debt financing.
EMR has a Debt to Equity ratio (0.42) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 5.19 | ||
| Altman-Z | 3.88 |
ROIC/WACC1.05
WACC8%
2.3 Liquidity
EMR has a Current Ratio of 0.85. This is a bad value and indicates that EMR is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of EMR (0.85) is worse than 79.57% of its industry peers.
A Quick Ratio of 0.63 indicates that EMR may have some problems paying its short term obligations.
The Quick ratio of EMR (0.63) is worse than 74.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 10.57% over the past year.
EMR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.33% yearly.
Looking at the last year, EMR shows a small growth in Revenue. The Revenue has grown by 4.81% in the last year.
EMR shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.98% yearly.
EPS 1Y (TTM)10.57%
EPS 3Y10.22%
EPS 5Y8.33%
EPS Q2Q%6.29%
Revenue 1Y (TTM)4.81%
Revenue growth 3Y-1.38%
Revenue growth 5Y-0.98%
Sales Q2Q%3.95%
3.2 Future
The Earnings Per Share is expected to grow by 8.54% on average over the next years. This is quite good.
EMR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.80% yearly.
EPS Next Y10.44%
EPS Next 2Y9.6%
EPS Next 3Y9.19%
EPS Next 5Y8.54%
Revenue Next Year3.68%
Revenue Next 2Y4.58%
Revenue Next 3Y4.62%
Revenue Next 5Y5.8%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 22.06, the valuation of EMR can be described as rather expensive.
Based on the Price/Earnings ratio, EMR is valued cheaper than 83.87% of the companies in the same industry.
EMR's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.40.
The Price/Forward Earnings ratio is 19.60, which indicates a rather expensive current valuation of EMR.
84.95% of the companies in the same industry are more expensive than EMR, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.94. EMR is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.06 | ||
| Fwd PE | 19.6 |
4.2 Price Multiples
81.72% of the companies in the same industry are more expensive than EMR, based on the Enterprise Value to EBITDA ratio.
83.87% of the companies in the same industry are more expensive than EMR, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.54 | ||
| EV/EBITDA | 17.09 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of EMR may justify a higher PE ratio.
PEG (NY)2.11
PEG (5Y)2.65
EPS Next 2Y9.6%
EPS Next 3Y9.19%
5. Dividend
5.1 Amount
EMR has a Yearly Dividend Yield of 1.64%.
Compared to an average industry Dividend Yield of 3.04, EMR pays a better dividend. On top of this EMR pays more dividend than 94.62% of the companies listed in the same industry.
EMR's Dividend Yield is slightly below the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.64% |
5.2 History
The dividend of EMR has a limited annual growth rate of 1.52%.
EMR has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of EMR decreased recently.
Dividend Growth(5Y)1.52%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
45.06% of the earnings are spent on dividend by EMR. This is a bit on the high side, but may be sustainable.
The dividend of EMR is growing, but earnings are growing more, so the dividend growth is sustainable.
DP45.06%
EPS Next 2Y9.6%
EPS Next 3Y9.19%
129.28
+0.39 (+0.3%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners83.89%
Inst Owner Change-0.19%
Ins Owners0.21%
Ins Owner Change-0.47%
Market Cap72.76B
Analysts78.82
Price Target151.8 (17.42%)
Short Float %2.84%
Short Ratio4.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.64% |
Yearly Dividend2.1
Dividend Growth(5Y)1.52%
DP45.06%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.65%
Min EPS beat(2)-0.41%
Max EPS beat(2)3.72%
EPS beat(4)2
Avg EPS beat(4)2.48%
Min EPS beat(4)-0.41%
Max EPS beat(4)6.76%
EPS beat(8)4
Avg EPS beat(8)3.84%
EPS beat(12)7
Avg EPS beat(12)4.29%
EPS beat(16)11
Avg EPS beat(16)4.43%
Revenue beat(2)1
Avg Revenue beat(2)-0.92%
Min Revenue beat(2)-1.94%
Max Revenue beat(2)0.09%
Revenue beat(4)2
Avg Revenue beat(4)-1%
Min Revenue beat(4)-2.32%
Max Revenue beat(4)0.17%
Revenue beat(8)4
Avg Revenue beat(8)-0.62%
Revenue beat(12)6
Avg Revenue beat(12)-0.42%
Revenue beat(16)7
Avg Revenue beat(16)-2.6%
PT rev (1m)0.08%
PT rev (3m)9.57%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.51%
EPS NY rev (1m)0.04%
EPS NY rev (3m)0.24%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)0.1%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.14%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.06 | ||
| Fwd PE | 19.6 | ||
| P/S | 4.09 | ||
| P/FCF | 26.54 | ||
| P/OCF | 22.94 | ||
| P/B | 3.66 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.09 |
EPS(TTM)5.86
EY4.53%
EPS(NY)6.59
Fwd EY5.1%
FCF(TTM)4.87
FCFY3.77%
OCF(TTM)5.64
OCFY4.36%
SpS31.59
BVpS35.31
TBVpS-14.14
PEG (NY)2.11
PEG (5Y)2.65
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.24% | ||
| ROE | 13.35% | ||
| ROCE | 10.64% | ||
| ROIC | 8.37% | ||
| ROICexc | 9% | ||
| ROICexgc | 153.04% | ||
| OM | 19.03% | ||
| PM (TTM) | 14.92% | ||
| GM | 52.7% | ||
| FCFM | 15.42% |
ROA(3y)14.81%
ROA(5y)12.47%
ROE(3y)34.72%
ROE(5y)30.17%
ROIC(3y)5.88%
ROIC(5y)8.65%
ROICexc(3y)6.74%
ROICexc(5y)10.11%
ROICexgc(3y)28.81%
ROICexgc(5y)33.99%
ROCE(3y)7.63%
ROCE(5y)11.31%
ROICexcg growth 3Y-11.32%
ROICexcg growth 5Y-10.06%
ROICexc growth 3Y-28.85%
ROICexc growth 5Y-20.68%
OM growth 3Y-7.28%
OM growth 5Y-3.77%
PM growth 3Y-3.78%
PM growth 5Y-2.16%
GM growth 3Y6.99%
GM growth 5Y3.61%
F-Score7
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 5.19 | ||
| Debt/EBITDA | 1.67 | ||
| Cap/Depr | 27.54% | ||
| Cap/Sales | 2.42% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 64.11% | ||
| Profit Quality | 103.36% | ||
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.63 | ||
| Altman-Z | 3.88 |
F-Score7
WACC8%
ROIC/WACC1.05
Cap/Depr(3y)36.82%
Cap/Depr(5y)46.68%
Cap/Sales(3y)2.88%
Cap/Sales(5y)3.01%
Profit Quality(3y)74.7%
Profit Quality(5y)96.72%
High Growth Momentum
Growth
EPS 1Y (TTM)10.57%
EPS 3Y10.22%
EPS 5Y8.33%
EPS Q2Q%6.29%
EPS Next Y10.44%
EPS Next 2Y9.6%
EPS Next 3Y9.19%
EPS Next 5Y8.54%
Revenue 1Y (TTM)4.81%
Revenue growth 3Y-1.38%
Revenue growth 5Y-0.98%
Sales Q2Q%3.95%
Revenue Next Year3.68%
Revenue Next 2Y4.58%
Revenue Next 3Y4.62%
Revenue Next 5Y5.8%
EBIT growth 1Y35.32%
EBIT growth 3Y-8.56%
EBIT growth 5Y-4.71%
EBIT Next Year23.43%
EBIT Next 3Y12.3%
EBIT Next 5Y7.7%
FCF growth 1Y30.09%
FCF growth 3Y-0.91%
FCF growth 5Y3.85%
OCF growth 1Y27.03%
OCF growth 3Y-2.32%
OCF growth 5Y2.08%