With a market cap of $65 billion, Emerson Electric Company (EMR) is a global technology and engineering company based in Missouri. A key player in specialty industrial machinery, Emerson Electric delivers innovative solutions to industrial, commercial, and residential markets worldwide.
Shares of Emerson Electric have considerably outperformed the broader market over the past year. EMR has soared 37.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 26.6%. In 2024, Emerson Electric stock rose 16.8%, while the SPX is up 11.3% on a YTD basis.
Narrowing the focus, EMR’s robust price performance looks more pronounced in comparison to the S&P 500 Industrial Sector SPDR (XLI). The exchange-traded fund has gained 25.6% over the past year, lower than EMR’s return.
EMR's outperformance relative to the broader indexes over the past year stems from its rising net income. On May 8, Emerson Electric shares surged 4.9% after the company reported better-than-expected Q2 revenue and earnings.
For the current fiscal year, ending in September, Street expects EMR’s EPS to grow 23.2% year over year to $5.47. However, the company’s earnings surprise history is mixed. It surpassed the consensus estimate in three of the last four quarters while missing on one other occasion.
Among the 20 analysts covering EMR stock, the consensus rating is a “Strong Buy.” That’s based on 16 “Strong Buy” ratings, one “Moderate Buy,” and three “Holds.”
This is slightly more bullish than a month before, with 15 analysts suggesting a "Strong Buy" rating.
On May 11, Loop Capital's Chris Dankert reiterated a “Strong Buy” rating on Emerson Electric while raising the price target by 3.8% from $130 to $135. Dankert's optimism comes from Emerson Electric's stellar Q2 performance. Highlighting strong organic sales growth and a favorable mix, Dankert sees this as key to their success. Plus, Emerson's full shift to 100% automation is a significant boost for their growth potential.
The mean price target of $128.31 suggests a 12.8% premium to EMR from current levels. The Street-high target of $140 represents an upside potential of 23.1%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
