EMERSON ELECTRIC CO (EMR) Stock Fundamental Analysis
NYSE:EMR - New York Stock Exchange, Inc. - US2910111044 - Common Stock
We assign a fundamental rating of 6 out of 10 to EMR. EMR was compared to 93 industry peers in the Electrical Equipment industry. EMR has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. EMR is not valued too expensively and it also shows a decent growth rate. With these ratings, EMR could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
In the past year EMR was profitable.
In the past year EMR had a positive cash flow from operations.
Each year in the past 5 years EMR has been profitable.
EMR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
EMR has a Return On Assets of 4.45%. This is amongst the best in the industry. EMR outperforms 80.22% of its industry peers.
With an excellent Return On Equity value of 9.10%, EMR belongs to the best of the industry, outperforming 83.52% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 5.03%, EMR is in the better half of the industry, outperforming 72.53% of the companies in the same industry.
EMR had an Average Return On Invested Capital over the past 3 years of 6.94%. This is below the industry average of 10.46%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.45% | ||
| ROE | 9.1% | ||
| ROIC | 5.03% |
ROA(3y)14.81%
ROA(5y)12.47%
ROE(3y)34.72%
ROE(5y)30.17%
ROIC(3y)6.94%
ROIC(5y)9.3%
1.3 Margins
EMR has a Profit Margin of 11.25%. This is amongst the best in the industry. EMR outperforms 87.91% of its industry peers.
EMR's Profit Margin has declined in the last couple of years.
EMR's Operating Margin of 14.06% is amongst the best of the industry. EMR outperforms 84.62% of its industry peers.
In the last couple of years the Operating Margin of EMR has declined.
The Gross Margin of EMR (50.79%) is better than 97.80% of its industry peers.
EMR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.06% | ||
| PM (TTM) | 11.25% | ||
| GM | 50.79% |
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) below the Cost of Capital (WACC), EMR is destroying value.
Compared to 1 year ago, EMR has less shares outstanding
EMR has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, EMR has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.95 indicates that EMR is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.95, EMR is in the better half of the industry, outperforming 78.02% of the companies in the same industry.
The Debt to FCF ratio of EMR is 2.64, which is a good value as it means it would take EMR, 2.64 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.64, EMR belongs to the top of the industry, outperforming 80.22% of the companies in the same industry.
EMR has a Debt/Equity ratio of 0.33. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.33, EMR is in line with its industry, outperforming 47.25% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.64 | ||
| Altman-Z | 3.95 |
ROIC/WACC0.48
WACC10.45%
2.3 Liquidity
EMR has a Current Ratio of 1.77. This is a normal value and indicates that EMR is financially healthy and should not expect problems in meeting its short term obligations.
EMR has a Current ratio (1.77) which is comparable to the rest of the industry.
A Quick Ratio of 1.40 indicates that EMR should not have too much problems paying its short term obligations.
EMR has a better Quick ratio (1.40) than 60.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.4 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 24.49% over the past year.
The Earnings Per Share has been growing by 8.33% on average over the past years. This is quite good.
Looking at the last year, EMR shows a quite strong growth in Revenue. The Revenue has grown by 15.34% 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)24.49%
EPS 3Y10.22%
EPS 5Y8.33%
EPS Q2Q%14.73%
Revenue 1Y (TTM)15.34%
Revenue growth 3Y-1.38%
Revenue growth 5Y-0.98%
Sales Q2Q%12.93%
3.2 Future
Based on estimates for the next years, EMR will show a small growth in Earnings Per Share. The EPS will grow by 7.90% on average per year.
EMR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.95% yearly.
EPS Next Y9.82%
EPS Next 2Y8.67%
EPS Next 3Y9.36%
EPS Next 5Y7.9%
Revenue Next Year4.81%
Revenue Next 2Y4.91%
Revenue Next 3Y4.96%
Revenue Next 5Y5.95%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.58, which indicates a rather expensive current valuation of EMR.
Based on the Price/Earnings ratio, EMR is valued a bit cheaper than the industry average as 79.12% of the companies are valued more expensively.
EMR's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.29.
With a Price/Forward Earnings ratio of 21.47, EMR is valued on the expensive side.
79.12% of the companies in the same industry are more expensive than EMR, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of EMR to the average of the S&P500 Index (24.44), we can say EMR is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.58 | ||
| Fwd PE | 21.47 |
4.2 Price Multiples
74.73% of the companies in the same industry are more expensive than EMR, based on the Enterprise Value to EBITDA ratio.
EMR's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. EMR is cheaper than 79.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.34 | ||
| EV/EBITDA | 18.79 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates EMR does not grow enough to justify the current Price/Earnings ratio.
EMR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.4
PEG (5Y)2.83
EPS Next 2Y8.67%
EPS Next 3Y9.36%
5. Dividend
5.1 Amount
EMR has a Yearly Dividend Yield of 1.71%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.40, EMR pays a better dividend. On top of this EMR pays more dividend than 94.51% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.28, EMR is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
5.2 History
The dividend of EMR has a limited annual growth rate of 1.52%.
EMR has paid a dividend for at least 10 years, which is 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
61.03% of the earnings are spent on dividend by EMR. This is not a sustainable payout ratio.
The dividend of EMR is growing, but earnings are growing more, so the dividend growth is sustainable.
DP61.03%
EPS Next 2Y8.67%
EPS Next 3Y9.36%
EMERSON ELECTRIC CO
NYSE:EMR (1/21/2025, 8:04:00 PM)
After market: 129.48 0 (0%)129.48
+4.95 (+3.97%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners79.62%
Inst Owner Change0.43%
Ins Owners0.21%
Ins Owner Change2.6%
Market Cap73.83B
Analysts78.71
Price Target142.45 (10.02%)
Short Float %1.91%
Short Ratio3.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.71% |
Yearly Dividend2.1
Dividend Growth(5Y)1.52%
DP61.03%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.17%
Min EPS beat(2)-0.19%
Max EPS beat(2)-0.15%
EPS beat(4)2
Avg EPS beat(4)5.78%
Min EPS beat(4)-0.19%
Max EPS beat(4)15.96%
EPS beat(8)4
Avg EPS beat(8)3.98%
EPS beat(12)8
Avg EPS beat(12)4.96%
EPS beat(16)12
Avg EPS beat(16)6.16%
Revenue beat(2)1
Avg Revenue beat(2)-1.18%
Min Revenue beat(2)-2.54%
Max Revenue beat(2)0.17%
Revenue beat(4)3
Avg Revenue beat(4)0.66%
Min Revenue beat(4)-2.54%
Max Revenue beat(4)4.02%
Revenue beat(8)5
Avg Revenue beat(8)-0.08%
Revenue beat(12)6
Avg Revenue beat(12)-2.8%
Revenue beat(16)9
Avg Revenue beat(16)-2%
PT rev (1m)3.34%
PT rev (3m)10.98%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.82%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.12%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.74%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.58 | ||
| Fwd PE | 21.47 | ||
| P/S | 4.22 | ||
| P/FCF | 25.34 | ||
| P/OCF | 22.16 | ||
| P/B | 3.41 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.79 |
EPS(TTM)5.49
EY4.24%
EPS(NY)6.03
Fwd EY4.66%
FCF(TTM)5.11
FCFY3.95%
OCF(TTM)5.84
OCFY4.51%
SpS30.68
BVpS37.94
TBVpS-12.04
PEG (NY)2.4
PEG (5Y)2.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.45% | ||
| ROE | 9.1% | ||
| ROCE | 6.39% | ||
| ROIC | 5.03% | ||
| ROICexc | 5.55% | ||
| ROICexgc | 30.19% | ||
| OM | 14.06% | ||
| PM (TTM) | 11.25% | ||
| GM | 50.79% | ||
| FCFM | 16.65% |
ROA(3y)14.81%
ROA(5y)12.47%
ROE(3y)34.72%
ROE(5y)30.17%
ROIC(3y)6.94%
ROIC(5y)9.3%
ROICexc(3y)7.87%
ROICexc(5y)10.79%
ROICexgc(3y)33.79%
ROICexgc(5y)37%
ROCE(3y)9.05%
ROCE(5y)12.16%
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 Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.64 | ||
| Debt/EBITDA | 1.72 | ||
| Cap/Depr | 24.81% | ||
| Cap/Sales | 2.4% | ||
| Interest Coverage | 12.74 | ||
| Cash Conversion | 80.33% | ||
| Profit Quality | 148.02% | ||
| Current Ratio | 1.77 | ||
| Quick Ratio | 1.4 | ||
| Altman-Z | 3.95 |
F-Score7
WACC10.45%
ROIC/WACC0.48
Cap/Depr(3y)36.82%
Cap/Depr(5y)46.68%
Cap/Sales(3y)2.5%
Cap/Sales(5y)2.78%
Profit Quality(3y)74.7%
Profit Quality(5y)96.72%
High Growth Momentum
Growth
EPS 1Y (TTM)24.49%
EPS 3Y10.22%
EPS 5Y8.33%
EPS Q2Q%14.73%
EPS Next Y9.82%
EPS Next 2Y8.67%
EPS Next 3Y9.36%
EPS Next 5Y7.9%
Revenue 1Y (TTM)15.34%
Revenue growth 3Y-1.38%
Revenue growth 5Y-0.98%
Sales Q2Q%12.93%
Revenue Next Year4.81%
Revenue Next 2Y4.91%
Revenue Next 3Y4.96%
Revenue Next 5Y5.95%
EBIT growth 1Y-15.27%
EBIT growth 3Y-8.56%
EBIT growth 5Y-4.71%
EBIT Next Year23.29%
EBIT Next 3Y12.39%
EBIT Next 5Y8.08%
FCF growth 1Y963.14%
FCF growth 3Y-0.91%
FCF growth 5Y3.85%
OCF growth 1Y423.08%
OCF growth 3Y-2.32%
OCF growth 5Y2.08%