Key Stats for Emerson Electric Stock
- Past-6-Month Performance: 15%
- 52-Week Range: $90 to $165
- Valuation Model Target Price: $179
- Implied Upside: 18.5%
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What Happened?
Emerson Electric Co. stock shares have risen about 15% over the last six months and recently traded near $151 per share as investors gained confidence in improving order trends and stronger visibility into 2026 earnings. The longer-term move reflects renewed optimism around the company’s automation and software exposure.
The stock moved higher primarily because accelerating orders and backlog growth improved confidence in revenue momentum heading into 2026.
Trailing 3-month orders rose 9%, trailing 12-month orders increased 6%, and backlog expanded 9%, signaling stronger demand across power generation, LNG, semiconductors, life sciences, and aerospace and defense.
With the stock trading below its $165 52-week high but well above its $90 low, recent price action reflects consolidation after the rally rather than deterioration in fundamentals.
At the Barclays Industrial Conference, CEO Lal Karsanbhai highlighted the improving demand environment and reinforced expectations for sustained growth.
Ovation orders rose 74% and the total power business grew 20%, driven by modernization work and behind-the-meter data center projects.
Emerson also grew annual contract value 9% in the first quarter and expects 10% plus ACV growth in 2026 despite weakness in China and Europe.
Karsanbhai said, “We feel really good about where the United States is going and how our technology is positioned to serve those industries.”
Institutional positioning remains elevated, with roughly 74.3% of shares held by institutions. State of New Jersey Common Pension Fund D increased its stake by 4.0% to 196,519 shares valued at about $25.78 million, HighTower Advisors raised its position by 5.5% to 695,266 shares worth roughly $91.2 million, and Vanguard lifted its holdings by 0.4% to 54,330,938 shares, representing about 9.65% of the company and valued near $7.13 billion.
Director Matthew Levatich sold 1,476 shares at $162.16 for $239,348, reducing his stake to 24,349 shares valued at about $3.95 million.
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Is Emerson Electric Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 5.3%
- Operating Margins: 21.6%
- Exit P/E Multiple: 21x
Revenue expectations reflect Emerson’s shift toward a more focused automation and software-driven industrial platform, where growth is increasingly tied to structural investment cycles rather than short-term industrial swings.
Analyst projections show revenue rising from $18,966.71 million in fiscal 2026 to $23,591.97 million by 2030, supported by steady expansion in process automation, LNG infrastructure, semiconductor capacity, aerospace and defense, and data center power modernization.
This supports the view that future returns depend more on backlog conversion, pricing discipline, and recurring software revenue expansion than on aggressive cyclical volume growth.
Based on these inputs, the model estimates a target price of $179, implying about 18.5% total upside and a 6.7% annualized return, indicating the stock appears undervalued under your framework.
Looking into 2026, sustained 9% order growth, expanding ACV, and continued LNG and power modernization activity are likely to support margin durability.
Emerson’s 52.8% gross margin, 24.6% EBIT margin, and net debt to EBITDA of 2.02x provide operating flexibility even as parts of Europe and China remain weak.
At current levels, Emerson appears modestly undervalued, with 2026 performance likely driven by automation demand, recurring software growth, backlog strength, and disciplined execution rather than short-term macro volatility.
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