EMERSON ELECTRIC CO (EMR) Stock Fundamental Analysis
USA - NYSE:EMR - US2910111044 - Common Stock
129.77 USD
+1.59 (+1.24%)
129.77 USD
0 (0%)
Overall EMR gets a fundamental rating of 6 out of 10. We evaluated EMR against 93 industry peers in the Electrical Equipment industry. While EMR has a great profitability rating, there are some minor concerns on its financial health. EMR is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
EMR had positive earnings in the past year.
In the past year EMR had a positive cash flow from operations.
In the past 5 years EMR has always been profitable.
Each year in the past 5 years EMR had a positive operating cash flow.
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.
EMR has a Return On Equity of 13.35%. This is amongst the best in the industry. EMR outperforms 84.95% of its industry peers.
EMR's Return On Invested Capital of 8.37% is fine compared to the rest of the industry. EMR outperforms 79.57% of its industry peers.
EMR had an Average Return On Invested Capital over the past 3 years of 5.88%. This 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 has a better Profit Margin (14.92%) than 90.32% of its industry peers.
EMR's Profit Margin has declined in the last couple of years.
EMR has a Operating Margin of 19.03%. This is amongst the best in the industry. EMR outperforms 95.70% of its industry peers.
EMR's Operating Margin has declined in the last couple of years.
EMR's Gross Margin of 52.70% is amongst the best of the industry. EMR outperforms 95.70% of its industry peers.
In the last couple of years the Gross Margin of EMR has grown nicely.
| 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
EMR has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for EMR has been reduced compared to 1 year ago.
Compared to 5 years ago, EMR has less shares outstanding
Compared to 1 year ago, EMR has an improved debt to assets ratio.
2.2 Solvency
EMR has an Altman-Z score of 3.87. This indicates that EMR is financially healthy and has little risk of bankruptcy at the moment.
EMR's Altman-Z score of 3.87 is fine compared to the rest of the industry. EMR outperforms 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.
The Debt to FCF ratio of EMR (5.19) is better than 75.27% of its industry peers.
EMR has a Debt/Equity ratio of 0.42. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.42, EMR perfoms like the industry average, outperforming 48.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 5.19 | ||
| Altman-Z | 3.87 |
ROIC/WACC1.04
WACC8.03%
2.3 Liquidity
A Current Ratio of 0.85 indicates that EMR may have some problems paying its short term obligations.
EMR has a worse Current ratio (0.85) than 79.57% of its industry peers.
EMR has a Quick 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.
EMR's Quick ratio of 0.63 is on the low side compared to the rest of the industry. EMR is outperformed by 74.19% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.63 |
3. Growth
3.1 Past
EMR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.57%, which is quite good.
The Earnings Per Share has been growing by 8.33% on average over the past years. This is quite good.
EMR shows a small growth in Revenue. In the last year, the Revenue has grown by 4.81%.
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
Based on estimates for the next years, EMR will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.54% on average per year.
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 22.15, 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.
Compared to an average S&P500 Price/Earnings ratio of 27.50, EMR is valued at the same level.
Based on the Price/Forward Earnings ratio of 19.68, the valuation of EMR can be described as rather expensive.
Based on the Price/Forward Earnings ratio, EMR is valued cheaply inside the industry as 82.80% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.99. EMR is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.15 | ||
| Fwd PE | 19.68 |
4.2 Price Multiples
EMR's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. EMR is cheaper than 81.72% of the companies in the same industry.
82.80% 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 | 26.65 | ||
| EV/EBITDA | 17.01 |
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)2.12
PEG (5Y)2.66
EPS Next 2Y9.6%
EPS Next 3Y9.19%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.60%, EMR has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.06, EMR pays a better dividend. On top of this EMR pays more dividend than 94.62% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.44, EMR is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
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.
EMR has decreased its dividend 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%
129.77
+1.59 (+1.24%)
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 Cap73.03B
Analysts78.82
Price Target151.8 (16.98%)
Short Float %2.84%
Short Ratio4.76
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.6% |
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 | 22.15 | ||
| Fwd PE | 19.68 | ||
| P/S | 4.11 | ||
| P/FCF | 26.65 | ||
| P/OCF | 23.02 | ||
| P/B | 3.68 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.01 |
EPS(TTM)5.86
EY4.52%
EPS(NY)6.59
Fwd EY5.08%
FCF(TTM)4.87
FCFY3.75%
OCF(TTM)5.64
OCFY4.34%
SpS31.59
BVpS35.31
TBVpS-14.14
PEG (NY)2.12
PEG (5Y)2.66
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 | 3.87 |
F-Score7
WACC8.03%
ROIC/WACC1.04
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%