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Here's Why it is Worth Investing in Emerson (EMR) Stock Now
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Emerson Electric Co. (EMR - Free Report) currently boasts robust prospects on strength across its end markets, strong backlog level, acquired assets and a sound capital-deployment strategy.
Notably, the Zacks Rank #2 (Buy) company has a market capitalization of $49.2 billion. In the past six months, it has gained 39.9% compared with the industry’s growth of 40.9%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
Strength in End Markets: Emerson is poised to benefit from consistent strength across its medical, life science, food and beverage, and power end markets. Exiting fourth-quarter fiscal 2020 (ended September 2020), the company’s robust backlog level — which was $4.7 billion at its Automation Solutions segment — is also likely to support its top-line performance in the quarters ahead.
Acquisition Benefits: The company intends to strengthen and expand its businesses through acquisitions. For instance, Emerson completed the acquisition of General Electric Company’s (GE - Free Report) Intelligent Platforms business in February 2019. The buyout expanded its opportunities across process and discrete industries as well as hybrid markets. Some other notable buyouts made by the company are Verdant (March 2020), American Governor Company (April 2020), Progea Group (October 2020) and 7AC Technologies (November 2020). Notably, Emerson expects the acquisitions to have a positive impact of 1% on sales growth in fiscal 2021 (ending September 2021).
Rewards to Shareholders: It remains committed to rewarding shareholders through dividend payouts and share buybacks. In fiscal 2020, the company paid dividends worth $1,209 million and repurchased shares worth $942 million. Also, in November 2020, it hiked the annual dividend rate by 2 cents.
Estimate Revisions: In the past 30 days, the Zacks Consensus Estimate for Emerson’s fiscal 2021 earnings has trended up from $3.46 to $3.48 on two upward estimate revisions against none downward. In addition, the consensus estimate for fiscal 2022 (ending September 2022) earnings increased from $3.93 to $3.96 on two upward estimate revisions against none downward.
Franklin Electric delivered a positive earnings surprise of 12.82%, on average, in the trailing four quarters.
SPX FLOW delivered a positive earnings surprise of 146.55%, on average, in the trailing four quarters.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
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Here's Why it is Worth Investing in Emerson (EMR) Stock Now
Emerson Electric Co. (EMR - Free Report) currently boasts robust prospects on strength across its end markets, strong backlog level, acquired assets and a sound capital-deployment strategy.
Notably, the Zacks Rank #2 (Buy) company has a market capitalization of $49.2 billion. In the past six months, it has gained 39.9% compared with the industry’s growth of 40.9%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
Strength in End Markets: Emerson is poised to benefit from consistent strength across its medical, life science, food and beverage, and power end markets. Exiting fourth-quarter fiscal 2020 (ended September 2020), the company’s robust backlog level — which was $4.7 billion at its Automation Solutions segment — is also likely to support its top-line performance in the quarters ahead.
Acquisition Benefits: The company intends to strengthen and expand its businesses through acquisitions. For instance, Emerson completed the acquisition of General Electric Company’s (GE - Free Report) Intelligent Platforms business in February 2019. The buyout expanded its opportunities across process and discrete industries as well as hybrid markets. Some other notable buyouts made by the company are Verdant (March 2020), American Governor Company (April 2020), Progea Group (October 2020) and 7AC Technologies (November 2020). Notably, Emerson expects the acquisitions to have a positive impact of 1% on sales growth in fiscal 2021 (ending September 2021).
Rewards to Shareholders: It remains committed to rewarding shareholders through dividend payouts and share buybacks. In fiscal 2020, the company paid dividends worth $1,209 million and repurchased shares worth $942 million. Also, in November 2020, it hiked the annual dividend rate by 2 cents.
Estimate Revisions: In the past 30 days, the Zacks Consensus Estimate for Emerson’s fiscal 2021 earnings has trended up from $3.46 to $3.48 on two upward estimate revisions against none downward. In addition, the consensus estimate for fiscal 2022 (ending September 2022) earnings increased from $3.93 to $3.96 on two upward estimate revisions against none downward.
Other Stocks to Consider
A couple of other top-ranked stocks from the same space are Franklin Electric Co., Inc. (FELE - Free Report) and SPX FLOW, Inc. (FLOW - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Franklin Electric delivered a positive earnings surprise of 12.82%, on average, in the trailing four quarters.
SPX FLOW delivered a positive earnings surprise of 146.55%, on average, in the trailing four quarters.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>