Emerson Electric Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Emerson Electric (NYSE:EMR) will unveil its latest earnings on Tuesday, November 6, 2012. Emerson Electric is a multinational technology company that designs and supplies product technology. It provides engineering services to a wide gamut of industrial, commercial, and consumer markets worldwide.

Emerson Electric Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $1.05 per share, a rise of 7.1% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.10. Between one and three months ago, the average estimate moved down. It also has dropped from $1.06 during the last month. Analysts are projecting profit to rise by 3.1% compared to last year’s $3.34.

Last quarter, the company came in at net income of $1.04 per share against a mean estimate of profit of $1 per share, beating estimates after missing them in the previous quarter. In the second quarter, it missed forecasts by 7 cents.

Earnings season is back and more important than ever. Get our newest CHEAT SHEET stock picks now

A Look Back: In the third quarter, profit rose 12.7% to $770 million ($1.04 a share) from $683 million (90 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 3.1% to $6.48 billion from $6.29 billion.

Stock Price Performance: Between August 7, 2012 and October 31, 2012, the stock price fell $1.36 (-2.7%), from $49.79 to $48.43. The stock price saw one of its best stretches over the last year between October 10, 2012 and October 18, 2012, when shares rose for seven straight days, increasing 2.7% (+$1.31) over that span. It saw one of its worst periods between August 24, 2012 and September 5, 2012 when shares fell for eight straight days, dropping 5.3% (-$2.72) over that span.

Wall St. Revenue Expectations: Analysts are projecting a rise of 2.3% in revenue from the year-earlier quarter to $6.69 billion.

Key Stats:

Last quarter’s earnings rise was a switch from preceding drops, so the upcoming earnings announcement is a chance to build on last quarter’s result. After net income declines in the first quarter and second quarter, profit rose in the third quarter.

On the top line, the company is looking to build on two-straight revenue increases with this earnings announcement. Revenue rose 1.1% in the second quarter before climbing again in the third quarter.

Analyst Ratings: There are mostly holds on the stock with 11 of 18 analysts surveyed giving that rating.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.35 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.38 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 6.8% to $7.4 billion while assets rose 4.8% to $10 billion.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

Don’t Miss These Additional Hot Stories:

Is Ford’s Stock a Buy After a Record Quarter?

Will Sirius’s Stock Still Be a Buy After the Buyout?

Is Facebook Harmful to Your Health and Wallet?