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Emerson Electric (EMR) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Emerson Electric (EMR - Free Report) closed at $97.88, marking a -1.05% move from the previous day. This change lagged the S&P 500's 0.42% loss on the day. Meanwhile, the Dow lost 0.56%, and the Nasdaq, a tech-heavy index, lost 0.08%.

Coming into today, shares of the maker of process controls systems, valves and analytical instruments had gained 1.75% in the past month. In that same time, the Industrial Products sector gained 1.83%, while the S&P 500 gained 1.02%.

Investors will be hoping for strength from Emerson Electric as it approaches its next earnings release. The company is expected to report EPS of $1.29, down 15.69% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.21 billion, down 21.54% from the prior-year quarter.

EMR's full-year Zacks Consensus Estimates are calling for earnings of $4.41 per share and revenue of $15.29 billion. These results would represent year-over-year changes of -16% and -22.1%, respectively.

Investors might also notice recent changes to analyst estimates for Emerson Electric. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.11% higher within the past month. Emerson Electric is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Emerson Electric has a Forward P/E ratio of 22.41 right now. Its industry sports an average Forward P/E of 21.08, so we one might conclude that Emerson Electric is trading at a premium comparatively.

Meanwhile, EMR's PEG ratio is currently 2.33. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Manufacturing - Electronics stocks are, on average, holding a PEG ratio of 2.2 based on yesterday's closing prices.

The Manufacturing - Electronics industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 43, putting it in the top 18% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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