Is Emerson Electric Company (EMR) overvalued?
On Equity Rank's model estimate, EMR trades close to its fair value (2% above it). Emerson Electric Company (EMR) last closed at $162.35; the multi-method model fair value is $159.79.
| Price | Model fair value | Price vs model |
|---|---|---|
| $162.35 | $159.79 | 2% above |
What the answer rests on
- 3 of 10 valuation methods put EMR's value above its price and 7 put it below, so the methods disagree.
- To justify today's price, EMR's free cash flow would need to grow about 12.1% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 134.5% a year.
- Over the past year the price sat below the model fair value on 21% of trading days. The gap ranged from 3% below to 44% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind EMR's fair value · What prices assume · Other companies