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Investing.com - KeyBanc has reiterated its Overweight rating and $155.00 price target on Emerson (NYSE:EMR) following the company’s Investor Day in New York City. This target represents a 25% upside from the current price of $123.72, positioning it between the analyst high target of $183 and low target of $111.
Emerson introduced new fiscal year 2028 targets at the event, including 4-7% organic growth, 30% EBITA margins, and approximately $8 per share in earnings. This represents significant growth from the company’s current diluted EPS of $4.03 and builds upon Emerson’s impressive 52.84% gross profit margins.
KeyBanc views these targets as "both achievable and potentially conservative" given Emerson’s exposure to secular demand trends and its ability to focus on execution now that its portfolio transformation is largely complete.
The firm highlighted Emerson’s increased emphasis on shareholder-friendly capital allocation as a positive factor for the stock.
KeyBanc also noted that Emerson maintains a valuation discount relative to its pure-play automation peers, which contributes to what the firm describes as a "compelling" risk/reward profile. According to InvestingPro, Emerson trades at a P/E ratio of 30.91, slightly above its Fair Value estimate. Discover more insights with InvestingPro’s comprehensive research report on Emerson, part of its coverage of 1,400+ US equities.
In other recent news, Emerson has announced ambitious financial goals, projecting net sales of $21 billion by 2028, which represents a 5% organic compound annual growth rate. The company also aims for a 30% adjusted segment EBITA margin and adjusted earnings per share of $8, reflecting a 10% compound annual growth rate. Emerson plans to return $10 billion to shareholders through share repurchases and increased dividends by 2028. Analyst firms have responded positively, with Wolfe Research raising its price target for Emerson to $168 from $165, maintaining an Outperform rating. Similarly, Mizuho reiterated an Outperform rating with a $155 price target. Emerson has updated its management organization and reportable segments, effective in fiscal 2026, to include five segments: Control Systems & Software, Test & Measurement, Sensors, Final Control, and Safety & Productivity. The company has also granted performance-based stock options to its top executives, including President and CEO Lal Karsanbhai, with exercise prices set at increasing premiums. These developments were revealed during Emerson’s recent investor events, highlighting the company’s strategic plans and targets.
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