Using the industry peer median P/E multiple (trailing + forward), Emerson Electric Co. (EMR) has a fair value of $151.21 based on 10 comparable companies in the Industrial - Machinery industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| Emerson Electric Co.EMR | 72,464 | 31.7x | 21.3x |
| Parker-Hannifin CorporationPH | 114,446 | 33.4x | 33.9x |
| Northrop Grumman CorporationNOC | 98,495 | 23.9x | 24.8x |
| Howmet Aerospace Inc.HWM | 93,360 | 62.5x | 50.4x |
| Waste Management, Inc.WM | 91,436 | 33.8x | 27.6x |
| United Parcel Service, Inc.UPS | 82,750 | 14.8x | 13.8x |
| Johnson Controls International plcJCI | 80,618 | 50.1x | 27.8x |
| Illinois Tool Works Inc.ITW | 75,379 | 24.9x | 25.0x |
| Cummins Inc.CMI | 73,414 | 25.9x | 25.9x |
| Cintas CorporationCTAS | 68,181 | 38.7x | 34.9x |
| TransDigm Group IncorporatedTDG | 65,151 | 36.0x | 29.7x |
| Industry Median | 33.6x | 27.7x | |
| (*) Profit after tax | 2,293 | 3,401 | |
| Equity Value | 77,125 | 94,258 | |
| (/) Outstanding shares | 567 | 567 | |
| Fair Price | $136 | $166 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.