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The Zacks Industrial Products Sector has displayed resiliency in 2022, down roughly 11% and outperforming the general market by a fair margin.
One company residing in the realm that many are familiar with, Emerson Electric Co. (EMR - Free Report) , has seen its near-term earnings outlook turn negative over the last several months, pushing it into a Zacks Rank #5 (Strong Sell).
Image Source: Zacks Investment Research
Emerson Electric Co. is a diversified global engineering and technology company providing a wide range of products and services to customers in consumer, commercial and industrial markets. Let’s take a closer look at how the company shapes up.
Share Performance & Valuation
Although the company’s earnings outlook has shifted sour over the last several months, EMR shares have outperformed in 2022, up a respectable 5% vs. the S&P 500’s 17% decline.
Image Source: Zacks Investment Research
Further, EMR shares currently trade at a 23.1X forward earnings multiple, above the 20.1X five-year median and its Zacks Industrial Products sector average of 18.0X.
Image Source: Zacks Investment Research
Emerson Electric currently carries a Value Style Score of an F.
Growth Outlook
EMR’s growth profile leaves some to be desired; for its current fiscal year, the Zacks Consensus EPS Estimate of $4.08 suggests a 22% decline year-over-year. Pivoting to the top-line, estimates indicate a 24% year-over-year pullback.
Still, the growth picks back up in FY24, with estimates calling for 10% earnings growth and a 6.7% uptick in revenue.
Image Source: Zacks Investment Research
Bottom Line
A slowdown in growth and negative earnings estimate revisions from analysts paint a less-than-ideal picture for the company in the short term.
Emerson Electric Co. (EMR - Free Report) is a Zacks Rank #5 (Strong Sell), telling us it has a weak near-term earnings outlook.
Investors should pivot to stocks that either carry a Zacks Rank #1 (Strong Buy) or Zacks Rank #2 (Buy) – these stocks have a much stronger earnings outlook and potential to deliver explosive gains in the short-term.
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Bear of the Day: Emerson Electric (EMR)
The Zacks Industrial Products Sector has displayed resiliency in 2022, down roughly 11% and outperforming the general market by a fair margin.
One company residing in the realm that many are familiar with, Emerson Electric Co. (EMR - Free Report) , has seen its near-term earnings outlook turn negative over the last several months, pushing it into a Zacks Rank #5 (Strong Sell).
Image Source: Zacks Investment Research
Emerson Electric Co. is a diversified global engineering and technology company providing a wide range of products and services to customers in consumer, commercial and industrial markets. Let’s take a closer look at how the company shapes up.
Share Performance & Valuation
Although the company’s earnings outlook has shifted sour over the last several months, EMR shares have outperformed in 2022, up a respectable 5% vs. the S&P 500’s 17% decline.
Image Source: Zacks Investment Research
Further, EMR shares currently trade at a 23.1X forward earnings multiple, above the 20.1X five-year median and its Zacks Industrial Products sector average of 18.0X.
Image Source: Zacks Investment Research
Emerson Electric currently carries a Value Style Score of an F.
Growth Outlook
EMR’s growth profile leaves some to be desired; for its current fiscal year, the Zacks Consensus EPS Estimate of $4.08 suggests a 22% decline year-over-year. Pivoting to the top-line, estimates indicate a 24% year-over-year pullback.
Still, the growth picks back up in FY24, with estimates calling for 10% earnings growth and a 6.7% uptick in revenue.
Image Source: Zacks Investment Research
Bottom Line
A slowdown in growth and negative earnings estimate revisions from analysts paint a less-than-ideal picture for the company in the short term.
Emerson Electric Co. (EMR - Free Report) is a Zacks Rank #5 (Strong Sell), telling us it has a weak near-term earnings outlook.
Investors should pivot to stocks that either carry a Zacks Rank #1 (Strong Buy) or Zacks Rank #2 (Buy) – these stocks have a much stronger earnings outlook and potential to deliver explosive gains in the short-term.