Sunday, February 14, 2016

Seeking Alpha: Emerson Skidding On The Oil Spill

There's not a lot more left to say about the state of multi-market industrial conglomerates that I haven't already said. Companies that have outsized exposure to commodity/resource markets and emerging markets, and that definitely includes Emerson (NYSE:EMR), are getting hit hard and there isn't much relief in sight. Although Emerson's CEO believes that orders will bottom in the spring of this year, that's well outside of the norm of what most peer company CEOs are saying and the company's lack of exposure to relatively healthier markets like aerospace, auto, food/bev is a drawback.

Emerson has been going through tough times longer than its peer group and management seems more realistic about the need for capacity curtailments. Even so, I think the company could find it hard to get full value for its Network Power business and the Industrial Automation assets it has targeted for sale. Emerson scores well for its margins and returns on capital, but it's hard for me to see how the company generates enough revenue growth to really drive an attractive fair value from here.

Click here for the full article:
Emerson Skidding On The Oil Spill

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