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Valued at a market cap of $79.8 billion, Emerson Electric Co. (EMR) is a technology and software company headquartered in Saint Louis, Missouri. It provides innovative solutions for customers in the industrial, commercial, and residential markets by focusing on automation, optimization, and energy efficiency to enhance performance and sustainability.
Shares of the automation leader have surged past the broader market over the past 52 weeks. EMR stock has rallied 30.6% over this time frame, while the broader S&P 500 Index ($SPX) has gained 18.4%. Moreover, on a YTD basis, EMR is up 15.1%, compared to SPX’s 7.6% return.
Zooming in further, EMR has also outperformed the Gabelli Automation ETF’s (GAST) 18.5% uptick over the past 52 weeks and 11.6% rise on a YTD basis.
Shares of EMR soared 2.4% on May 7, after it delivered stronger-than-expected Q2 results. Due to strong growth in underlying orders, the company’s overall revenue advanced 1.3% year-over-year to $4.4 billion, topping consensus estimates by 1.1%. Moreover, its adjusted EPS of $1.48 improved 8.8% from the same period last year and came in 4.2% above the analyst expectations. A notable 200-basis-point annual expansion in its adjusted segment EBITA margin to a record 28% aided its bottom-line figure.
For the current fiscal year, ending in September, analysts expect EMR’s EPS to grow 9.3% year over year to $6. The company’s earnings surprise history is promising. It exceeded the consensus estimates in each of the last four quarters.
Among the 24 analysts covering the stock, the consensus rating is a "Moderate Buy” which is based on 17 “Strong Buy,” one "Moderate Buy,” four “Hold,” one "Moderate Sell," and one "Strong Sell” rating.
The configuration has remained consistent over the past three months.
On Jul. 16, RBC Capital analyst Deane Dray maintained a “Buy” rating on EMR and set a price target of $154, indicating an 8% potential upside from the current levels.
The mean price target of $145.33 represents a 1.9% premium from EMR’s current price levels, while the Street-high price target of $171 suggests an upside potential of 19.9%.
