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Here's Why You Should Consider Investing in Emerson (EMR) Stock
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Emerson Electric Co. (EMR - Free Report) currently boasts strong prospects on the back of strength across its end markets, acquired assets and a sound capital-deployment strategy.
The Zacks Rank #2 (Buy) company has a market capitalization of $55.3 billion. In the past six months, it has gained 36.4% compared with the industry’s growth of 33.3%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
End-Market Strength: Emerson is likely to gain from strength across its several end markets including medical, life science, semiconductor, food and beverage, and cold chain. The company’s robust backlog level — which was $5.3 billion at its Automation Solutions segment exiting first-quarter fiscal 2021 (ended December 2020) — is also likely to support its top-line performance in the quarters ahead.
Benefits From Acquired Assets: The company acquired 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). Emerson expects the acquisitions to have a positive impact of 1% on sales growth in fiscal 2021 (ending September 2021).
Shareholder-Friendly Policies: In fiscal 2020 (ended September 2020), the company paid dividends worth $1,209 million, along with repurchasing shares of $942 million. Also, in the fiscal first quarter it paid dividends worth $303 million and repurchased shares worth $13 million. Further, in November 2020, it hiked the annual dividend rate by 2 cents.
Estimate Revisions: In the past seven days, the Zacks Consensus Estimate for Emerson’s fiscal 2021 earnings has trended up from $3.65 to $3.71 on one upward estimate revision. In addition, the consensus estimate for fiscal 2022 (ending September 2022) earnings increased from $4.14 to $4.15.
ABB delivered a positive earnings surprise of 54.17%, on average, in the trailing four quarters.
Eaton delivered a positive earnings surprise of 13.69%, on average, in the trailing four quarters.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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Here's Why You Should Consider Investing in Emerson (EMR) Stock
Emerson Electric Co. (EMR - Free Report) currently boasts strong prospects on the back of strength across its end markets, acquired assets and a sound capital-deployment strategy.
The Zacks Rank #2 (Buy) company has a market capitalization of $55.3 billion. In the past six months, it has gained 36.4% compared with the industry’s growth of 33.3%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
End-Market Strength: Emerson is likely to gain from strength across its several end markets including medical, life science, semiconductor, food and beverage, and cold chain. The company’s robust backlog level — which was $5.3 billion at its Automation Solutions segment exiting first-quarter fiscal 2021 (ended December 2020) — is also likely to support its top-line performance in the quarters ahead.
Benefits From Acquired Assets: The company acquired 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). Emerson expects the acquisitions to have a positive impact of 1% on sales growth in fiscal 2021 (ending September 2021).
Shareholder-Friendly Policies: In fiscal 2020 (ended September 2020), the company paid dividends worth $1,209 million, along with repurchasing shares of $942 million. Also, in the fiscal first quarter it paid dividends worth $303 million and repurchased shares worth $13 million. Further, in November 2020, it hiked the annual dividend rate by 2 cents.
Estimate Revisions: In the past seven days, the Zacks Consensus Estimate for Emerson’s fiscal 2021 earnings has trended up from $3.65 to $3.71 on one upward estimate revision. In addition, the consensus estimate for fiscal 2022 (ending September 2022) earnings increased from $4.14 to $4.15.
Other Key Picks
A couple of other top-ranked stocks from the same space are ABB Ltd and Eaton Corporation, plc (ETN - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ABB delivered a positive earnings surprise of 54.17%, on average, in the trailing four quarters.
Eaton delivered a positive earnings surprise of 13.69%, on average, in the trailing four quarters.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>