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Emerson Electric Co. (EMR)

Company Dividend Discount ModelIndustry: Industrial - MachinerySector: Industrials

Valuation Snapshot

Stable Growth$31.87 - $46.92$39.09
Multi-Stage$50.18 - $54.97$52.53
Blended Fair Value$45.81
Current Price$131.18
Upside-65.08%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS-0.28%-0.62%2.102.122.112.162.142.132.132.172.192.17
YoY Growth---0.75%0.25%-2.04%1.07%0.08%0.00%-1.63%-0.81%0.98%-3.31%
Dividend Yield--1.60%1.71%2.17%2.25%2.30%2.65%2.80%3.63%3.14%3.88%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)2,293.00
(-) Cash Dividends Paid (M)1,192.00
(=) Cash Retained (M)1,101.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)458.60286.63171.98
Cash Retained (M)1,101.001,101.001,101.00
(-) Cash Required (M)-458.60-286.63-171.98
(=) Excess Retained (M)642.40814.38929.03
(/) Shares Outstanding (M)566.68566.68566.68
(=) Excess Retained per Share1.131.441.64
LTM Dividend per Share2.102.102.10
(+) Excess Retained per Share1.131.441.64
(=) Adjusted Dividend3.243.543.74
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-0.96%0.04%1.04%
Fair Value$31.87$39.09$46.92
Upside / Downside-75.71%-70.20%-64.23%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)2,293.002,293.862,294.732,295.592,296.452,297.322,366.24
Payout Ratio51.98%59.59%67.19%74.79%82.40%90.00%92.50%
Projected Dividends (M)1,192.001,366.851,541.841,716.961,892.212,067.592,188.77

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate-0.96%0.04%1.04%
Year 1 PV (M)1,240.341,252.871,265.39
Year 2 PV (M)1,269.641,295.411,321.43
Year 3 PV (M)1,282.981,322.241,362.29
Year 4 PV (M)1,283.061,335.681,389.89
Year 5 PV (M)1,272.231,337.761,405.98
PV of Terminal Value (M)22,085.7923,223.5624,407.74
Equity Value (M)28,434.0429,767.5131,152.72
Shares Outstanding (M)566.68566.68566.68
Fair Value$50.18$52.53$54.97
Upside / Downside-61.75%-59.96%-58.09%

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