EMERSON ELECTRIC CO (EMR) Stock Fundamental Analysis
USA - NYSE:EMR - US2910111044 - Common Stock
132.34 USD
+0.43 (+0.33%)
132.15 USD
-0.19 (-0.14%)
Overall EMR gets a fundamental rating of 6 out of 10. We evaluated EMR against 92 industry peers in the Electrical Equipment industry. EMR has an excellent profitability rating, but 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
In the past year EMR was profitable.
EMR had a positive operating cash flow in the past year.
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's Return On Assets of 6.24% is amongst the best of the industry. EMR outperforms 81.52% of its industry peers.
The Return On Equity of EMR (13.35%) is better than 84.78% of its industry peers.
EMR has a better Return On Invested Capital (8.37%) than 80.43% of its industry peers.
The Average Return On Invested Capital over the past 3 years for EMR is below the industry average of 9.86%.
The last Return On Invested Capital (8.37%) for EMR is above the 3 year average (5.88%), which is a sign of increasing profitability.
| 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
Looking at the Profit Margin, with a value of 14.92%, EMR belongs to the top of the industry, outperforming 90.22% of the companies in the same industry.
EMR's Profit Margin has declined in the last couple of years.
The Operating Margin of EMR (19.03%) is better than 95.65% of its industry peers.
EMR's Operating Margin has declined in the last couple of years.
The Gross Margin of EMR (52.70%) is better than 96.74% of its industry peers.
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so EMR is still creating some value.
The number of shares outstanding for EMR has been reduced compared to 1 year ago.
EMR has less shares outstanding than it did 5 years ago.
EMR has a better debt/assets ratio than last year.
2.2 Solvency
EMR has an Altman-Z score of 3.93. This indicates that EMR is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.93, EMR is in the better half of the industry, outperforming 70.65% of the companies in the same industry.
EMR has a debt to FCF ratio of 5.19. This is a neutral value as EMR would need 5.19 years to pay back of all of its debts.
EMR's Debt to FCF ratio of 5.19 is fine compared to the rest of the industry. EMR outperforms 75.00% 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 47.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 5.19 | ||
| Altman-Z | 3.93 |
ROIC/WACC1.03
WACC8.12%
2.3 Liquidity
A Current Ratio of 0.85 indicates that EMR may have some problems paying its short term obligations.
The Current ratio of EMR (0.85) is worse than 80.43% 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 76.09% 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.
The Revenue has been growing slightly by 4.81% in the past year.
Measured over the past years, EMR shows a decrease in Revenue. The Revenue has been decreasing by -0.98% on average per year.
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.
The Revenue is expected to grow by 5.80% on average over the next years.
EPS Next Y10.4%
EPS Next 2Y9.58%
EPS Next 3Y9.19%
EPS Next 5Y8.54%
Revenue Next Year3.71%
Revenue Next 2Y4.62%
Revenue Next 3Y4.68%
Revenue Next 5Y5.8%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
EMR is valuated rather expensively with a Price/Earnings ratio of 22.58.
83.70% of the companies in the same industry are more expensive than EMR, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.38. EMR is around the same levels.
EMR is valuated rather expensively with a Price/Forward Earnings ratio of 20.07.
81.52% of the companies in the same industry are more expensive than EMR, based on the Price/Forward Earnings ratio.
EMR is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.86, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.58 | ||
| Fwd PE | 20.07 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of EMR indicates a somewhat cheap valuation: EMR is cheaper than 78.26% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of EMR indicates a rather cheap valuation: EMR is cheaper than 81.52% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.17 | ||
| EV/EBITDA | 17.48 |
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 an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.17
PEG (5Y)2.71
EPS Next 2Y9.58%
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 3.07, EMR pays a better dividend. On top of this EMR pays more dividend than 93.48% of the companies listed in the same industry.
EMR's Dividend Yield is slightly below the S&P500 average, which is at 2.38.
| 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
EMR pays out 45.06% of its income as dividend. 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 2Y9.58%
EPS Next 3Y9.19%
132.34
+0.43 (+0.33%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners83.16%
Inst Owner Change1.23%
Ins Owners0.21%
Ins Owner Change-0.47%
Market Cap74.48B
Analysts78.82
Price Target151.68 (14.61%)
Short Float %2.74%
Short Ratio4.92
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)2.96%
PT rev (3m)9.48%
EPS NQ rev (1m)0.2%
EPS NQ rev (3m)-0.21%
EPS NY rev (1m)0%
EPS NY rev (3m)0.37%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)0.26%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.58 | ||
| Fwd PE | 20.07 | ||
| P/S | 4.19 | ||
| P/FCF | 27.17 | ||
| P/OCF | 23.48 | ||
| P/B | 3.75 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.48 |
EPS(TTM)5.86
EY4.43%
EPS(NY)6.59
Fwd EY4.98%
FCF(TTM)4.87
FCFY3.68%
OCF(TTM)5.64
OCFY4.26%
SpS31.59
BVpS35.31
TBVpS-14.14
PEG (NY)2.17
PEG (5Y)2.71
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 | 3.93 |
F-Score7
WACC8.12%
ROIC/WACC1.03
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 Y10.4%
EPS Next 2Y9.58%
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 Year3.71%
Revenue Next 2Y4.62%
Revenue Next 3Y4.68%
Revenue Next 5Y5.8%
EBIT growth 1Y35.32%
EBIT growth 3Y-8.56%
EBIT growth 5Y-4.71%
EBIT Next Year23.94%
EBIT Next 3Y11.92%
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%