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Emerson Electric Co EMR

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PREMIUM

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PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

No Real Surprises in Emerson's Solid Third-Quarter Print

Joshua Aguilar Equity Analyst

Analyst Note

| Joshua Aguilar |

Nothing in wide-moat-rated Emerson’s fiscal third-quarter results materially alters our long-term view of the firm. Emerson hit sales of $4,697 million (up 20% year over year on a reported basis, or about 15% organic) versus our expectations of $4,666 million. Further, GAAP EPS came in at $1.04 versus our expectations of $1.06. Nonetheless, management had enough confidence to raise guidance based on year-to-date performance, order strength, and projects in the pipeline (with backlog rising to $5.5 billion, up 17% year to date). While were correct in penciling in a full-year adjusted EPS projection above management’s May guidance (we believed there was conservatism due to concerns about supply chain-related headwinds), we still fell short of the midpoint of the increased guidance by about $0.07.

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Company Profile

Business Description

Emerson Electric is a multi-industrial conglomerate that operates under two business platforms: automation solutions and commercial and residential solutions. The latter is further subdivided into two operating segments: climate technologies, which sells HVAC and refrigeration products and services, as well as tools and home products, which sells tools and compressors, among other products and services. Commercial and residential solutions boasts several household brands, including Copeland, InSinkErator, and RIDGID. Automation solutions is most known for its process manufacturing solutions, which consists of measurement instrumentation, as well as valves and actuators, among other products and services. About half of the firm’s geographic sales take place in the United States.

Contact
8000 West Florissant Avenue, P.O. Box 4100
St. Louis, MO, 63136
T +1 314 553-2000
Sector Industrials
Industry Specialty Industrial Machinery
Most Recent Earnings Jun 30, 2021
Fiscal Year End Sep 30, 2021
Stock Type Cyclical
Employees 83,500

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