EMR
Emerson Electric Co.$152.08
Unclear
Target $146.11
Report: Mar 07, 2026Industrials • Industrial - Machinery • Mature CompounderSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$152.08-3.9%
Rec: UnclearConviction: Medium
Entry Target
$112.39
(26% below current)
Fair Value
$146.11
(4% below current)
Stop Loss
$83.08
(45% below current)
Position Size
Starter
Time Horizon
Long-Term (3+ Years)
Key Metrics
Live Snapshot
Market Data
52 Week High$165.15
52 Week Low$90.06
Avg. 3 Month Volume3.44M
Efficiency
LTM Gross Margin52.8%
LTM EBITDA Margin26.4%
LTM EBIT Margin18.2%
LTM Operating Margin17.9%
LTM ROA5.5%
LTM ROE11.6%
LTM ROIC20.9%
LTM ROCE10.1%
Capital Structure
Market Cap (MM)$73.6B
Enterprise Value (MM)$85.3B
Shares Outstanding561.80M
Total Debt (MM)$13.41B
Cash & Equivalents (MM)$1.75B
LTM Net Debt (MM)$11.66B
LTM Net Debt/EBITDA2.4x
Growth
TTM Rev. Growth3.6%
Last 3-Yr Rev. CAGR-0.6%
Last 3-Yr EBITDA CAGR-10.1%
Last 3-Yr EPS CAGR-19.6%
Valuation
Street Target Price$162.92
LTM EV/Revenue4.7x
LTM EV/Gross Profit8.9x
LTM EV/EBIT25.8x
LTM EV/EBITDA17.7x
LTM P/E31.8x
LTM EV/FCF33.1x
LTM P/FCF28.6x
LTM P/TB5.1x
LTM P/B3.6x
Dividend Yield1.6%
Payout Ratio52.0%
Executive SummarySituation: Current price is $152.08 versus fair value $146.11 (-3.9% expected return), and valuation confidence is stable. Debate: Bull case depends on Execution of the 2028 Value Creation Framework. Bear case centers on Moat Erosion in Discrete Automation. Conclusion: Recommendation is Unclear; maintain no position until reliability and catalyst evidence improve.
Bull Case
Emerson's integration of AspenTech and NI creates a unique software-defined automation stack that can capture outsized share in the 250 billion dollar automation market. Secular tailwinds from reshoring, energy security, and AI data center expansion provide a long runway for 10%+ ACV growth and margin expansion toward 30%.
Bear Case
The company's growth is slowing, with revenue rising only 3% in fiscal 2025 compared to 15.3% in 2024. High leverage of 2.4x net debt to EBITDA and deteriorating cash conversion of 1.35x limit capital allocation flexibility, while a 120 million dollar software renewal accounting headwind will pressure margins in fiscal 2026.
Key Catalysts
Long-Term (18+ months)Impact: High
Execution of the 2028 Value Creation Framework. Management's ability to demonstrate progress toward 21 billion dollars in revenue and 30% EB...
Mid-Term (6-18 months)Impact: Moderate
Successful Launch and Adoption of Nigel.ai. This AI-enabled test and measurement platform is critical for validating the National Instrument...
Long-Term (18+ months)Impact: Moderate
Emerson is relevant now because it has just completed its multi-year portfolio transformation, and the market is closely watching for the fi...
Primary Risks
Concern: Medium
Moat Erosion in Discrete Automation. Increased competitive intensity from low-cost rivals or disruptive technologies could permanently impai...
Concern: High
Financial Risk from High Leverage. The surge in net debt to 11.6 billion dollars (2.4x EBITDA) reduces the margin of safety and could lead t...
Concern: Medium
Stewardship is strong, supported by a board that includes five former CEOs with deep M&A and industrial expertise. The separation of the Cha...
Recent Activity
2024-11-06SEC Filing (8-K)
+7.81%Emerson reported Q4 and full year 2024 results; announced strategic portfolio transformation.
2024-11-05Analyst Target
+7.16%Firm: KeyBanc Analyst: Ken Newman Price Target: $125.00 Price When Posted: $117.27 Implied Upside: +6.6%
2024-08-08Analyst Target
+5.09%Firm: Mizuho Securities Analyst: Brett Linzey Price Target: $130.00 Price When Posted: $99.54 Implied Upside: +30.6%
2024-08-07SEC Filing (8-K)
-7.65%Emerson reported Q3 2024 results with 11% net sales growth and updated 2024 outlook.
2024-02-07SEC Filing (8-K)
+10.43%Emerson Electric Co. reports first quarter 2024 results with 22% sales growth and updates full year outlook.
Valuation Table
9.8/10Decision Grade