Emerson Electric Co. (EMR)
Quantitative Summary
DeterministicEMR trades at 33.4x earnings, roughly in line with its sector average of 44.7x. Financial health metrics are strong: Piotroski 7/9, Altman Z 4.2 (above 3.0 safe zone threshold). DCF fair value of $69 implies 52% downside based on model assumptions.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of Emerson Electric reveal a tension between high-quality balance sheet characteristics and capital allocation efficiency. While the Piotroski F-Score of 7/9 and Beneish M-Score of -2.63 signal strong financial health and low earnings manipulation risk, the ROIC-WACC spread stands at -3.5%, indicating that current operations are destroying value relative to the cost of capital. This inefficiency is partially offset by a DuPont-decomposed ROE of 11.3%, driven primarily by robust net margins of 12.7% rather than asset turnover or leverage, yet this profitability factor weakness (RMW: -0.370) contrasts with the company's value tilt in Fama-French models. The Altman Z-Score of 4.1 further confirms a low probability of bankruptcy, suggesting that while solvency is secure, the capital structure may not be generating sufficient returns on invested assets to justify its cost.
Valuation metrics present a significant divergence between market pricing and intrinsic value estimates derived from cash flow modeling. The current P/E ratio of 32.3x aligns closely with the sector average of 32.1x, yet this multiple implies an aggressive forward growth trajectory that conflicts sharply with recent revenue performance of only 3.0% year-over-year. More critically, a DCF analysis suggests a fair value of $72, which corresponds to -45.3% downside from current levels when accounting for the market's implicit expectation of sustained free cash flow growth averaging 23.0% over the next decade. This disparity indicates that investors are pricing in expansionary dynamics not currently reflected in top-line results, creating a potential valuation disconnect where future expectations outweigh present fundamentals.
Risk factors and factor-based returns add nuance to the investment thesis through Fama-French alpha data and insider activity patterns. The stock exhibits a positive annual alpha of 1.44%, suggesting it has outperformed its risk-adjusted benchmark over time, while simultaneously displaying a negative profitability tilt that may limit future momentum despite its value characteristics. However, recent insider flow shows $2,555,751 in net selling over the last ninety days, which often precedes or accompanies periods of valuation compression as management adjusts to market conditions. These signals collectively paint a picture of a financially stable entity trading at an expansion premium that may not be fully supported by current operational leverage and growth rates.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 3% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 9.9% | 11.9% | 13.9% |
|---|---|---|---|
| 2% | $83 | $63 | $50 |
| 3% | $94 | $69 | $54 |
| 4% | $109 | $77 | $59 |
Center = base case. Green = >10% upside, Red = >10% downside vs $142.03.
Pre-computed DCF: WACC=11.8%, terminal growth 3%. Fair value $69 (-52.0%). Not investment advice.
Valuation Context
Currently trading 31% below its 5-year average P/E of 51.4x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedEmerson Electric Co. is currently trading at $130.65, a position that warrants examination relative to its surrounding moving average envelope structure. Without specific upper and lower band values from the provided data set, an absolute determination of overbought or oversold conditions cannot be mathematically confirmed; however, the current price acts as a focal point for assessing mean-reversion potential. If this level sits near the outer boundaries of a historical standard deviation range, it suggests increased volatility pressure that often precedes a corrective move toward the centerline. Conversely, positioning within the inner half of the envelope might indicate sustained momentum rather than an imminent reversal. The technical implication hinges entirely on whether $130.65 represents a statistical outlier or a consolidation zone relative to recent trend lines. In scenarios where price action deviates significantly from the mean, market mechanics frequently drive values back toward equilibrium, creating opportunities for traders anticipating such corrections. Yet, if the current level remains comfortably inside the channel's core, the probability of continued directional movement increases, potentially delaying any significant reversion event. Observers must weigh this specific price point against the dynamic width of the envelope to gauge how far removed the asset is from its recent average behavior. Ultimately, the relative-value thesis for EMR depends on interpreting $130.65 through the lens of statistical probability rather than isolated data points. The market's reaction will likely be dictated by whether this price level triggers a psychological or algorithmic response
Quant Health Deep Dive
Profitability & Value Creation
✅ Conservative payout — room for dividend increases.
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Insider Activity (Last 90 Days)
Open-market buys vs sells by company insiders. Source: yfinance.
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-05-15 | $0.5550 | 0.0% |
| 2026-02-13 | $0.5550 | 0.0% |
| 2025-11-14 | $0.5550 | +5.1% |
| 2025-08-15 | $0.5280 | 0.0% |
| 2025-05-16 | $0.5280 | 0.0% |
| 2025-02-14 | $0.5280 | 0.0% |
| 2024-11-15 | $0.5280 | +0.6% |
| 2024-08-16 | $0.5250 | 0.0% |
| 2024-05-16 | $0.5250 | 0.0% |
| 2024-02-15 | $0.5250 | 0.0% |
| 2023-11-16 | $0.5250 | +1.0% |
| 2023-08-10 | $0.5200 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like XLI or NOBL, the fund manager is mechanically forced to buy or sell EMR shares regardless of Emerson Electric Co.'s individual fundamentals. We estimate $9.2B of passive capital is structurally linked to EMR through 8 tracked ETFs. This substantial passive exposure means that ETF inflows and outflows — not company fundamentals — can dominate daily volume on this stock.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in Emerson Electric Co. to visualize passive redemption contagion across ETFs and collateral stocks.
If Emerson Electric Co. (EMR) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies CATERPILLAR INC (CAT) as the most exposed collateral stock, sharing 2 ETFs with EMR. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 30 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
EMR Ownership Dynamics
Passive funds hold 1 in every 8 EMR shares, reducing daily market volatility.
Emerson Electric Co. (EMR) exerts measurable gravity on the passive index market, currently representing 1.4% of the State Street Industrial Select Sector SPDR ETF (XLI) and 1.4% of the ProShares S&P 500 Dividend Aristocrats ETF (NOBL). Across 31 tracked ETFs, approximately 73M shares (13.0% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest EMR Exposure
Float lock-up computed from 31 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
EMR Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for Emerson Electric Co. over the past year sits near $131.60 (18% of 252-day volume). The current price of $142.03 trades 7.9% above this institutional floor — a sign of upside momentum, though a pullback to the POC zone is a common reversion target. The highly concentrated volume profile (18% at POC) indicates strong consensus on fair value — institutional participants have repeatedly transacted near this price.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
EMR Capital Efficiency
How efficiently does Emerson Electric Co. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
Emerson Electric Co. converts 55% of its EBITDA into free cash flow, a healthy conversion rate indicating efficient capital management — the business generates substantial cash after reinvestment. However, the ROIC-WACC spread is negative (-3.7%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-14 | 108 | $137.76 | $14,878.08 |
| 2026-05-11 | 154 | $141.31 | $21,761.74 |
| 2026-05-07 | 9 | $147.99 | $1,331.91 |
| 2026-05-06 | 1,260 | $138.38 | $174,358.8 |
| 2026-05-05 | 2,121 | $135.46 | $287,310.66 |
| 2026-05-04 | 1,103 | $137.45 | $151,607.35 |
| 2026-05-01 | 113 | $140.44 | $15,869.72 |
| 2026-04-30 | 1,175 | $136.56 | $160,458 |
| 2026-04-29 | 1,915 | $138.42 | $265,074.3 |
| 2026-04-24 | 78,000 | $142.44 | $11.1M |
| 2026-04-23 | 870 | $142.77 | $124,209.9 |
| 2026-04-22 | 796 | $144.83 | $115,284.68 |
| 2026-04-21 | 3,085 | $146.77 | $452,785.45 |
| 2026-04-17 | 1,429 | $140.37 | $200,588.73 |
| 2026-04-16 | 340 | $140.40 | $47,736 |
| 2026-04-15 | 3 | $144.56 | $433.68 |
| 2026-04-14 | 2,184 | $144.46 | $315,500.64 |
| 2026-04-10 | 1,934 | $144.67 | $279,791.78 |
| 2026-04-08 | 309 | $134.64 | $41,603.76 |
| 2026-04-06 | 232 | $131.70 | $30,554.4 |
| 2026-04-01 | 29 | $131.02 | $3,799.58 |
| 2026-03-25 | 56 | $130.15 | $7,288.4 |
| 2026-03-24 | 261 | $129.83 | $33,885.63 |
| 2026-03-23 | 48 | $128.15 | $6,151.2 |
| 2026-03-18 | 314 | $132.49 | $41,601.86 |
| 2026-03-16 | 5,502 | $132.24 | $727,584.48 |
| 2026-03-13 | 1,161 | $132.18 | $153,460.98 |
| 2026-03-06 | 70,364 | $142.22 | $10.0M |
| 2026-03-05 | 962 | $145.21 | $139,692.02 |
| 2026-03-03 | 2,137 | $152.08 | $324,994.96 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| ROK | 0.731 | 0.755 | High co-movement |
| IR | 0.702 | 0.699 | High co-movement |
| DOV | 0.656 | 0.613 | Moderate |
| AME | 0.649 | 0.636 | Moderate |
| PH | 0.638 | 0.576 | Moderate |
| CFG | 0.638 | 0.601 | Moderate |
| CMI | 0.631 | 0.624 | Moderate |
| SWK | 0.628 | 0.595 | Moderate |
| NDSN | 0.621 | 0.647 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare EMR to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.