3 models fit Emerson Electric Company Common Stock and they disagree: 0 of 3 land within 15% of the average.
Two or more of our models back this value.
Large premium(i)Bronze58
Valued as a cyclical company: P/E comparison, EV/EBITDA comparison, Discounted cash flow, and Graham number.
ACCE opinionEmerson Electric Company Common Stock (EMR)
Fair value (3 models)
$106
ACCE price target
$148
Rating
Overvalued
Horizon
12 months
Fair value published on 21 Oct 2026, 13:04 CEST; previously $110 since 12 Oct 2026, 00:00 CEST.
ACCE price target published on 19 Sept 2026, 00:00 CEST.
Rating published on 21 Oct 2026, 13:04 CEST.
Price used: $162 at the close on 23 Oct 2026, 22:00 CEST.
Models: P/E comparison, EV/EBITDA comparison, and Graham number.
Fair value: the average of the applicable valuation models (discounted cash flow, multiples, residual income, dividend discount, shareholder yield), each run on the latest financial statements and the market price shown. Opinion columns (fair value, target, rating) are shown apart from the data. Full methodology: acceinvestments.com/data/how-we-value-stocks
Conflicts of interest: The author holds no personal position in this security. General statement
Produced by ACCE Investments (acceinvestments.com)
Data
Price vs fair value
52.2% above
-34.3% to fair value
ACCE score
62
out of 100
Analysts
67% buy
30 covering
P/E
35.4x
forward 22.2x
1-year return
+21.3%
Dividend yield
1.39%
Emerson Electric Company Common Stock in four questions
Plain answers, details below
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Overview
ACCE thesis
Emerson manufactures process management and climate technologies sold to oil and gas, refining, chemical, and HVAC customers, with software and services representing roughly 40% of revenue. The company has built a defensible position through deep domain expertise in critical infrastructure where switching costs are high and regulatory compliance locks in vendor relationships. Automation software adoption in industrial facilities is accelerating as operators seek efficiency gains and emissions reduction, positioning Emerson's software-as-a-service offerings for sustained double-digit growth. At a forward PE of 22.3x against an operating margin of 26.9%, the valuation reflects execution risk rather than structural premium, and the company trades at a discount to pure-play software peers despite recurring revenue now exceeding 40% of the total. The near-term catalyst is margin expansion as legacy hardware businesses stabilize and higher-margin software scales, a dynamic that could compress the forward multiple if the company demonstrates consistent 15%+ software growth.
⚠ Investor warnings · 3 flagsAI-assisted·How I use AI
high
Valuation premium to model
Limited margin of safety.
moderate
Five-year revenue decline
5y revenue CAGR of -2.8% masks recent recovery. Structural headwinds or portfolio shifts warrant scrutiny before extrapolating 7% YoY growth.
moderate
Insider selling concentration
Last 10 disclosures show $6.45M in sales, zero buys. Modest absolute amount, but directional signal warrants monitoring.
AI research notes
AI-assisted·How I use AIWritten Oct 11, 2026 · figures from 2026-06-30 · prices to Oct 23, 2026
Why it could do well
Recent revenue growth of 7.0% year over year shows the company is accelerating after a 5-year decline averaging 2.8% annually.
Strong free cash flow of 3.7 billion dollars over the last 12 months supports the 1.4% dividend and ongoing share buybacks reducing dilution by 1.3%.
Analyst consensus rates 67% of coverage as Buy or Strong Buy with a mean price target implying 7.7% upside from current levels.
Why it could disappoint
The stock trades at 35.4x trailing earnings and 22.3x forward earnings, a premium to the 23.9x sector median that consensus values at 32.3% below the current price.
Return on invested capital of 5.6% lags the 5.2% risk-free rate, meaning the company destroys value on incremental capital deployed.
Net margin of 13.8% trails operating margin significantly, indicating debt service and taxes from acquisitions are consuming earnings growth and limiting upside.
Each chip shows the exact figure and where it comes from. A claim without a source is not published.
Next results
Nov 4, 2026
We update the fair value about 2 days after the results, once the new figures are filed.Add to calendarGoogle
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Valuation
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Where EMR's valuation models land
Price
$161.59
Model fair value
$106
Model range
$57.40 to $189
Fair value $106
Price $162
The price sits inside the model range.
Model
Fair value
Upside
Discounted cash flow
EV/EBITDA comparison
Graham number
P/E comparison
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Quality
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