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Tickers in this Article: EMR
On Tuesday, November 6, 2012, Emerson Electric (NYSE:EMR) will report its fourth quarter earnings.

Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: Earnings: Quality Means Everything

What to Expect: The consensus estimate for Emerson's earnings is $1.05 per share, up 7.1% from a year ago when the company reported earnings of 98 cents per share.

Whereas the consensus estimate was $1.10 three months ago, it has since fallen. Analysts are expecting earnings of $3.34 per share for the fiscal year.

Revenue is expected to exceed last year's figure of $6.54 billion by 2.2% and come in at $6.69 billion for the quarter. Emerson is expected to report revenue of $24.44 billion for the fiscal year.

Company Performance: The average revenue increase over the past four quarters is 6.2%. The biggest increase was in the fourth quarter of the last fiscal year, up 24.8% from the year-earlier quarter.

The P/E ratio for EMR is 14.7, above the industry average of 8.93. Usually, if a stock has a high P/E ratio, it indicates that the market expects the company to grow earnings quickly in the future. A company's price/earnings ratio (P/E ratio) provides a measure of how expensive or cheap a stock is. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: The P/E Ratio: A Good Market-Timing Indicator

The stock price has fallen slightly over the past quarter, from $48.50 on August 3, 2012 to its current price, $48.43. Emerson's worst recent stretch was when its stock price fell $1.73 per share between September 24, 2012 and September 25, 2012.

The Competition: Emerson Electric is a multinational technology company that designs and supplies product technology. It provides engineering services to a wide gamut of industrial, commercial, and consumer markets worldwide. Analysts generally consider Emerson a hold, with 11 of 18 analysts rating it as such. Buy ratings have increased slightly over the last three months.

The company's closest competitor in the scientific and technical instr. industry is Honeywell (HON). Analysts are less optimistic about Emerson than about Honeywell. Sixteen out of 20 analysts rate the latter a buy compared to seven of 18 for the former.

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