Emerson Electric (EMR) Suffers a Larger Drop Than the General Market: Key Insights

Emerson Electric (EMR) closed the most recent trading day at $129.88, moving -1.97% from the previous trading session. This change lagged the S&P 500's daily loss of 1.36%. On the other hand, the Dow registered a loss of 1.64%, and the technology-centric Nasdaq decreased by 1.46%.

Shares of the maker of process controls systems, valves and analytical instruments have depreciated by 10.99% over the course of the past month, underperforming the Industrial Products sector's loss of 8.71%, and the S&P 500's loss of 1.76%.

The upcoming earnings release of Emerson Electric will be of great interest to investors. In that report, analysts expect Emerson Electric to post earnings of $1.55 per share. This would mark year-over-year growth of 4.73%. Meanwhile, the latest consensus estimate predicts the revenue to be $4.62 billion, indicating a 4.32% increase compared to the same quarter of the previous year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $6.5 per share and a revenue of $18.98 billion, indicating changes of +8.33% and +5.36%, respectively, from the former year.

Investors should also take note of any recent adjustments to analyst estimates for Emerson Electric. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.12% lower. Emerson Electric is currently sporting a Zacks Rank of #3 (Hold).

With respect to valuation, Emerson Electric is currently being traded at a Forward P/E ratio of 20.39. Its industry sports an average Forward P/E of 24.84, so one might conclude that Emerson Electric is trading at a discount comparatively.

Also, we should mention that EMR has a PEG ratio of 2.11. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. EMR's industry had an average PEG ratio of 1.87 as of yesterday's close.

The Manufacturing - Electronics industry is part of the Industrial Products sector. With its current Zacks Industry Rank of 62, this industry ranks in the top 26% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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Emerson Electric Co. (EMR): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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