Emerson Electric Company
🇺🇸 EMR · NYSE/NASDAQ · US2910111044
Industrials
USD 136.42 price at analysis
Scores
Key Metrics
Powered by EODHDP/E (TTM)
31.5
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Calculation: 136.42 ÷ 4.33 = 31.5
TTM period through: 2026-03-31
Forward P/E (estimated): 20.4
Based on analyst estimates
Reference: Provider P/E (Trailing): 31.2
Yield (Fwd)
1.63%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Trailing Yield (TTM): 1.63%
Div. Growth (5Y CAGR)
1.1%
Growth Streak
9 yrs
Consecutive years of increase
Net Debt/EBITDA (TTM)
2.2x
Latest quarter: 9.1x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
TTM through: 2026-03-31
Latest quarter (2026-03-31): 9.1x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
Payout (Fwd)
51.2%
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Payout (TTM): 49.8%
Cash Flow Payout (TTM): 34.2%
FCF Coverage (TTM): 2.56x
ROE
12.3%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
17.2x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
Summary
Emerson Electric is a high-quality global leader in industrial automation with an exceptionally safe dividend backed by robust free cash flow and a wide competitive moat. However, current valuation multiples remain highly elevated, and the 1.63% yield falls short of core income requirements. Existing shareholders should maintain positions given the strong fundamentals, but current pricing offers no margin of safety for new capital.
Sector Context
Emerson Electric is a global technology and engineering company that provides automation solutions for industrial, commercial, and consumer markets. In the context of dividend investing, mature industrial automation companies often provide stable, predictable cash flows supported by high customer switching costs, though they can be subject to broader macroeconomic cyclicality.
📊 Strategy Analysis
- • High-quality industrial automation leader with a robust competitive moat and exceptionally safe dividend coverage (Cash Flow Payout of 34.2%).
- • Consistent free cash flow generation and a manageable Net Debt/EBITDA of 2.25x provide a strong foundation for continued dividend stability and business resilience.
⚠ What to Watch
- • Current valuation is severely elevated with a TTM P/E of 31.49x and P/FFO of 20.57x, well above the strategy's target value ranges.
- • The trailing dividend yield of 1.63% falls significantly below the >3% minimum threshold required for pure dividend income strategies.
- • Trading at $136.42, the stock sits substantially above the fair value monopoly upper bound estimate of $77.99, leaving no margin of safety for new capital allocation.
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Dividend Sustainability (FCF vs Dividends Paid)
Free cash flowFree Cash Flow
Cash left after the company pays for running the business and maintaining it. Often used to fund dividends, pay debt, or buy back shares. (FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., blue) should cover dividends paidDividends Paid
Cash the company paid out to shareholders. It’s not guaranteed and can change over time. (green). If dividends consistently exceed FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., the dividend may be at risk.
Analysis date: 2026-05-23
Disclaimer: This information is for educational purposes only. Not financial advice.