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Emerson Electric Co.

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Emerson is well-positioned to benefit from global infrastructure growth, as its core businesses hold dominant positions in markets tied to energy efficiency and infrastructure spending. The company’s aggressive restructuring actions and strategic divestures look successful. Going forward, thriving HVAC and refrigeration business, strength in U.S. & Asia and high infrastructure spending is expected to stoke growth. Moreover, its recent acquisitions, Pentair and Permasense, look promising. However, prolonged softness in the oil and gas markets has affected both capital spending and operational expenditure of clients, thereby impacting the company’s order rates and hurting Emerson’s prospects. Also, currency fluctuations and escalating restructuring charges also pose as concerns. In light of these trends, Emerson’s shares have underperformed the Zacks-categorized Machinery Electrical industry average over the past one year.

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