Emerson Electric provides technology and engineering solutions to industrial, commercial, and consumer markets worldwide. It operates through five segments: Process Management, Industrial Automation, Network Power, Climate Technologies, and Commercial & Residential Solutions. The company was founded in 1890 and is based in St. Louis, Missouri.
EMR Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for EMR, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Emerson Electric Co ranked in the 30th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 52%. The most interesting components of our discounted cash flow analysis for Emerson Electric Co ended up being:
The company's compound free cash flow growth rate over the past 5.5 years comes in at -0.02%; that's greater than merely 22.66% of US stocks we're applying DCF forecasting to.
EMR's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 26.42% of tickers in our DCF set.
The weighted average cost of capital for the company is 8. This value is greater than only 24.95% stocks in the Industrials sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as EMR, try DOV, CMI, GTES, GWW, and MSA.
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