Emerson Electric Company (EMR) AI Stock Analysis

• Market Cap: $77.52B
• Dividend Yield: 1.59%
• Average Volume (3M): 2.67M
• Price to Earnings (P/E): 29.6
• Beta (1Y): 1.27
• Revenue Growth: 4.78%
• EPS Growth: 59.68%
• Country: US
• Employees: 73,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 1.62
• Shares Outstanding: 562,800,000
• 10 Day Avg. Volume: 2,820,884
• 30 Day Avg. Volume: 2,665,430
• PEG Ratio: -3.93
• Price to Book (P/B): 2.89
• Price to Sales (P/S): 3.57
• P/FCF Ratio: 21.45
• Enterprise Value/Market Cap: 0.00
• Enterprise Value/Revenue: 0.00
• Enterprise Value/Gross Profit: 0.00
• Enterprise Value/Ebitda: 0.00
• 1Y Price Target: $148.42
• Price Target Upside: 7.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14
• EPS Forecast (FY): 6.56
• Revenue Forecast (FY): $19.05B

• Rating: 73 Outperform
• Price Target: $149.00 ▲(8.17% Upside)

Emerson Electric Company has a strong financial foundation with robust revenue growth and profitability, which is the most significant factor in its stock score. The positive outlook from the earnings call further supports the score, highlighting strategic collaborations and growth potential. However, the high valuation and neutral technical indicators slightly temper the overall score.

Positive Factors

Strategic Collaborations

The collaboration with TotalEnergies enhances Emerson's market position by leveraging industrial data fabric technology, potentially accelerating AI implementation and operational performance improvements.

Revenue Growth

Projected sales growth indicates Emerson's ability to expand its market reach and maintain a positive growth trajectory, supported by strategic initiatives and product developments.

Cash Flow Generation

Strong cash flow generation reflects Emerson's operational efficiency and financial health, providing resources for reinvestment and strategic initiatives.

Negative Factors

Rising Debt Levels

Increased leverage could strain Emerson's financial flexibility, potentially impacting its ability to fund growth initiatives and manage economic downturns.

European Sales Decline

Declining sales in Europe highlight regional challenges that may affect Emerson's overall revenue and market share, requiring strategic adjustments to counteract.

FX and Tariff Headwinds

FX and tariff challenges can erode profitability, necessitating cost management strategies to sustain margins and competitive positioning in affected markets.

Emerson Electric Company Business Overview & Revenue Model

Company Description

Emerson Electric Company (EMR) is a global technology and engineering company specializing in automation solutions and commercial and residential solutions. Operating through two main business segments, Automation Solutions and Commercial & Residential Solutions, Emerson provides a wide range of products and services, including process automation systems, industrial control systems, and HVAC products. The company is known for its innovative technologies that enhance operational efficiency across various industries, such as oil and gas, manufacturing, and food and beverage.

How the Company Makes Money

Emerson generates revenue through multiple key streams, primarily from the sale of its automation and control products, services, and solutions. The Automation Solutions segment, which includes process management, industrial automation, and software, contributes significantly to the company’s earnings by addressing the needs of various industries for improved efficiency and productivity. The Commercial & Residential Solutions segment focuses on HVAC systems, tools, and appliances, catering to both residential and commercial markets. Additionally, Emerson benefits from long-term service contracts, maintenance agreements, and software subscriptions, which provide recurring revenue. Strategic partnerships with other technology firms and collaborations with industry leaders further enhance its product offerings and market reach, contributing to steady revenue growth.

Emerson Electric Company Financial Statement Overview

Summary

Emerson Electric Company exhibits strong financial health with robust revenue growth and profitability. The balance sheet is stable, though increased leverage should be monitored. Cash flow generation is solid, but the decline in free cash flow growth is a potential risk. Overall, the company is well-positioned in the industrial machinery sector with a strong financial foundation.

Income Statement

Emerson Electric Company has demonstrated strong revenue growth with a TTM increase of 9.77%. The gross profit margin is robust at 47.38%, indicating efficient production and cost management. The net profit margin has improved to 14.92%, reflecting enhanced profitability. EBIT and EBITDA margins are healthy, showing effective operational management. Overall, the income statement reflects a positive growth trajectory and strong profitability.

Balance Sheet

The company's debt-to-equity ratio has increased to 0.75, indicating a moderate level of leverage. However, the return on equity is solid at 13.06%, showcasing effective use of equity to generate profits. The equity ratio stands at 46.73%, suggesting a stable capital structure. While the increase in debt warrants attention, the overall balance sheet remains strong with good equity utilization.

Cash Flow

Operating cash flow to net income ratio is at 0.30, indicating sufficient cash generation relative to net income. However, the free cash flow growth rate is negative at -76%, which is a concern. The free cash flow to net income ratio is high at 86.41%, showing strong cash conversion. Despite the decline in free cash flow growth, the cash flow statement reflects solid cash generation capabilities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	17.78B	17.49B	15.16B	13.80B	12.93B	16.79B
Gross Profit	9.37B	8.88B	7.43B	6.31B	5.73B	7.01B
EBITDA	4.78B	4.03B	4.21B	3.50B	2.69B	3.36B
Net Income	2.65B	1.97B	13.22B	3.23B	2.30B	1.97B
Balance Sheet
Total Assets	42.52B	44.25B	42.75B	35.67B	24.71B	22.88B
Cash, Cash Equivalents and Short-Term Investments	2.22B	3.59B	8.05B	1.80B	2.35B	3.31B
Total Debt	14.87B	8.20B	8.56B	10.69B	7.08B	7.86B
Total Liabilities	22.63B	16.74B	16.15B	19.36B	14.79B	14.44B
Stockholders Equity	19.87B	21.64B	20.69B	10.36B	9.88B	8.40B
Cash Flow
Free Cash Flow	2.74B	2.91B	274.00M	2.39B	2.99B	2.54B
Operating Cash Flow	3.17B	3.33B	637.00M	2.92B	3.58B	3.08B
Investing Cash Flow	2.74B	-5.36B	12.41B	-5.33B	-2.12B	-740.00M
Financing Cash Flow	-5.98B	-2.46B	-6.82B	2.05B	-2.42B	-509.00M

Emerson Electric Company Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 137.74
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EMR, the sentiment is Negative. The current price of 137.74 is above the 20-day moving average (MA) of 132.72, above the 50-day MA of 132.51, and above the 200-day MA of 124.72, indicating a neutral trend. The MACD of 1.39 indicates Negative momentum. The RSI at 47.37 is Neutral, neither overbought nor oversold. The STOCH value of 63.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EMR.

Emerson Electric Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ETN	78 Outperform	$146.71B	37.78	20.69%	1.07%	8.24%	6.21%
PH	75 Outperform	$97.31B	28.36	27.42%	0.93%	-0.40%	24.40%
EMR	73 Outperform	$77.52B	29.59	10.86%	1.59%	4.78%	59.68%
ROK	72 Outperform	$40.46B	42.22	28.46%	1.42%	-8.23%	-3.29%
CMI	71 Outperform	$59.07B	20.16	27.56%	1.70%	-1.30%	53.39%
ITW	71 Outperform	$71.05B	23.77	91.71%	2.52%	-0.41%	-10.88%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Emerson Electric Company Corporate Events

Emerson Electric Reports Strong Q3 2025 Results

Emerson Electric is a global industrial technology leader specializing in advanced automation solutions, offering a comprehensive range of intelligent devices, control systems, and industrial software to optimize business performance. In its third quarter of 2025, Emerson Electric reported a 4% increase in net sales, reaching $4.553 billion, and a significant 72% rise in GAAP earnings per share to $1.03. The company also declared a quarterly cash dividend of $0.5275 per share. Key financial highlights include a 16.1% pretax earnings margin and a 6% increase in adjusted earnings per share to $1.52. Emerson’s strategic focus on enhancing its industrial software capabilities is evident, with the launch of innovative digital solutions driving productivity and efficiency for its clients. Looking ahead, Emerson anticipates a 3.5% growth in net and underlying sales for fiscal 2025, with expectations of returning $2.3 billion to shareholders through share repurchases and dividends, maintaining a positive outlook for continued growth and shareholder value.

Emerson Electric’s Earnings Call: Balancing Growth and Challenges

The recent earnings call from Emerson Electric presented a balanced sentiment, highlighting both strong performance and existing challenges. The company showcased impressive achievements in Test & Measurement and solid EBITDA margins, while also acknowledging the impacts of tariffs, foreign exchange fluctuations, and regional weaknesses, particularly in Europe and bulk chemicals. This balance between positive outcomes and ongoing challenges painted a comprehensive picture of the company’s current standing.