Back to top

Image: Bigstock

Emerson Electric (EMR) Gains As Market Dips: What You Should Know

Read MoreHide Full Article

In the latest trading session, Emerson Electric (EMR - Free Report) closed at $88.53, marking a +1.03% move from the previous day. The stock outpaced the S&P 500's daily loss of 1.31%. Elsewhere, the Dow lost 0.39%, while the tech-heavy Nasdaq lost 2.7%.

Heading into today, shares of the maker of process controls systems, valves and analytical instruments had gained 4.6% over the past month, lagging the Industrial Products sector's gain of 5.68% and outpacing the S&P 500's gain of 1.32% in that time.

Investors will be hoping for strength from EMR as it approaches its next earnings release. In that report, analysts expect EMR to post earnings of $0.89 per share. This would mark no growth from the year-ago period. Our most recent consensus estimate is calling for quarterly revenue of $4.35 billion, up 4.53% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.71 per share and revenue of $17.86 billion. These totals would mark changes of +7.23% and +6.38%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for EMR. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 7.38% higher. EMR is currently a Zacks Rank #2 (Buy).

Looking at its valuation, EMR is holding a Forward P/E ratio of 23.61. Its industry sports an average Forward P/E of 24.3, so we one might conclude that EMR is trading at a discount comparatively.

Meanwhile, EMR's PEG ratio is currently 2.4. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Manufacturing - Electronics stocks are, on average, holding a PEG ratio of 2.05 based on yesterday's closing prices.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 76, putting it in the top 30% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Emerson Electric Co. (EMR) - free report >>

Published in