Summary of Emerson Electric Conference Call Company Overview - **Company**: Emerson Electric (NYSE: EMR) - **Date of Conference**: March 17, 2026 - **Key Speaker**: Ram Krishnan, COO Industry Insights - **Geographical Exposure**: Emerson has significant global exposure, with 9% of sales from the Middle East and Africa, and 7% specifically from the Middle East [17][18]. - **Current Events Impact**: Recent geopolitical events in the Middle East have created operational challenges, but the company has managed to maintain safety and operational continuity for its employees and customers [17][18]. Financial Performance - **Sales Growth**: - Orders were up 9% in Q1, with North America up 18%, India up over 20%, and the rest of Asia up 13% [22]. - The Test & Measurement (T&M) business saw a 20% increase, while the power business grew by 17% in sales and 30% in orders [22]. - Ovation orders increased by 74% [22]. - **Project Pipeline**: The project pipeline stands at $11 billion, with $6.4 billion in growth verticals such as life sciences, aerospace, defense, and LNG [30]. - **Market Conditions**: Weakness in Europe and China persists, particularly in automotive and factory automation sectors [30][31]. Future Outlook - **Revenue Expectations**: - The company anticipates manageable impacts from current geopolitical tensions if resolved quickly, with expectations of returning to normal operations in the second half of the year [19][20]. - Long-term growth is projected at 4%-7%, with a focus on achieving $21 billion in revenue by 2027 [99][103]. - **Software Business**: The software segment is expected to grow from $2.5 billion to $3.5 billion by 2028, with a significant recovery in renewals anticipated in 2027 and 2028 [67][68]. Operational Strategies - **AI Integration**: Emerson is investing in AI capabilities to enhance productivity and automate processes, particularly in finance and customer care [95][96]. - **Cost Management**: The company aims for a free cash flow generation of 18% this year, targeting 20% by 2028 [121][122]. Capital Allocation - **Cash Flow**: Emerson plans to generate $14 billion in operating cash flow over the next three years, with $10 billion allocated for shareholder returns, including $4 billion in dividends and $6 billion in share repurchases [126][127]. - **M&A Strategy**: The company is open to bolt-on acquisitions if attractive opportunities arise, particularly in sensing or software [127]. Key Risks - **Geopolitical Risks**: Ongoing tensions in the Middle East could impact logistics and operational continuity [18][19]. - **Market Weakness**: Continued softness in Europe and China may affect overall growth and demand [30][31]. Conclusion Emerson Electric is navigating current geopolitical challenges while maintaining a strong growth trajectory in various sectors. The company is focused on leveraging AI and software capabilities to drive future growth, with a disciplined approach to capital allocation and risk management.

Summary of Emerson Electric Conference Call Company Overview - **Company**: Emerson Electric (NYSE: EMR) - **Date**: February 18, 2026 - **Key Speakers**: Lal Karsanbhai (President and CEO), Mike Baughman (CFO) Key Points Industry and Market Dynamics - Emerson's software business is valued at **$1.6 billion ACV** with a target of **10% growth** in ACV for the year, driven by strong demand in mission-critical applications across regulated industries such as power generation, pharmaceuticals, and energy [1][14] - The company emphasizes the importance of integrating AI into existing software, with products like **Ovation Virtual Advisor** and **Aspen Virtual Advisor** already generating over **$100 million in quotations** [14][21] - The software business is protected by three key moats: 1. **Deterministic and domain expertise** in vertical applications [5][6] 2. Focus on **mission-critical applications** in regulated industries [9] 3. Economic moat through **perpetual licenses** and usage-based tokens [11][12] Financial Performance - Emerson reported a **9% ACV growth** in the last quarter and expects similar growth in the current quarter, despite a **2-point headwind** from a previous job [14] - The company has seen **74% order growth** in the Ovation product line, primarily driven by modernization projects in the U.S. [50][62] - The overall order rate is stable, with a trailing twelve-month rate of **6%**, supported by a strong installed base of **$155 billion** [80][87] Regional Insights - The U.S. market is experiencing strong growth, particularly in sectors like **semiconductors, aerospace and defense, energy, life sciences, and power** [46][48] - Emerson has aligned its strategy to focus on these growth factors, benefiting from favorable U.S. industrial policies [48][49] - The company anticipates continued growth in the Middle East and India, offsetting weaknesses in China and Europe [135][137] Future Outlook - Emerson is committed to returning **$10 billion** in cash to shareholders, with plans for **$6 billion in share repurchases** and **$4 billion in dividends** [172] - The company is focused on enhancing its R&D investment, which has increased from **4% to 8%**, aiming for **double-digit growth** in technology innovation [184] - Emerson is preparing for potential growth in the nuclear sector and is actively pursuing opportunities in emerging markets like India and the Middle East [76][137] Challenges and Considerations - The company has assumed a **weak recovery** in China and Europe in its forecasts, which could impact overall growth if conditions improve unexpectedly [37][38] - There are ongoing challenges in the automotive sector, particularly in the electrical batteries and ADAS markets, which remain weak [106][108] - Emerson is monitoring supply chain dynamics, particularly regarding DRAM availability and tariffs, which could affect costs but are not expected to materially impact overall financial performance [152][154] Conclusion - Emerson Electric is strategically positioned for growth through its focus on software integration, strong market presence in critical industries, and commitment to shareholder returns. The company is navigating challenges in certain markets while capitalizing on opportunities in the U.S. and emerging markets.

Summary of Emerson Electric FY Conference Call (February 17, 2026) Company Overview - **Company**: Emerson Electric (NYSE: EMR) - **Key Executives**: Lal Karsanbhai (President and CEO), Mike Baughman (CFO) Key Industry Insights - **Order Intake**: Strong end to the calendar year with trailing 3-month orders at 9% and trailing 12-month orders at 6% [3][4] - **Backlog**: Increased by 9% in the quarter, indicating confidence in executing the company's plan [3] - **Growth Vectors**: Significant strength in power generation, LNG, semiconductor growth, life sciences, and aerospace and defense [3][14] - **Geographic Growth**: Concentrated in the United States, Arabian Peninsula, Brazil, Japan, and Southeast Asia [3] Financial Performance - **Power Generation**: Ovation business up 74% in the quarter; total power business up 20% [14] - **MRO Orders**: Mid-single-digit range, supportive of ongoing business growth [4][12] - **Software Renewal Impact**: 2% drag from software renewal dynamic in the first half, underlying growth expected at 4%-6% [12][13] - **ACV Growth**: Grew 9% in the first quarter; expected high single-digit growth in the second quarter [38] Market Challenges - **China and Europe**: No expected recovery in China; weak market conditions in Europe [6] - **Automotive Sector**: Weakness noted in the U.S. automotive market, reflecting a global trend [18] - **Chemical Industry**: Bulk chemicals facing overcapacity issues, expected to take 6-12 months to correct [18][25] Strategic Focus - **Investment in LNG**: Over 50% of global LNG installations run by DeltaV; significant growth opportunities in this sector [28][29] - **AI Integration**: Emerson's software is designed to integrate AI applications, focusing on deep domain expertise and mission-critical applications [30][31][33] - **Pricing Power**: 2.5 points of pricing power expected; ability to manage price increases effectively [44][46] Future Outlook - **Capital Deployment**: Focus on returning cash to shareholders through dividends and share repurchases; potential for bolt-on acquisitions in key verticals [61][62] - **Profitability Improvement**: Expected 240 basis points of margin improvement; confidence in achieving 40% operating leverage in the future [55][58] Additional Insights - **Customer Demand**: Strong demand for AI applications embedded in existing software offerings [33][34] - **Market Positioning**: Emerson's technology positioned well to serve heavily regulated industries, providing a competitive advantage [31][32] - **Innovation**: Continuous innovation in test and measurement and other verticals to maintain market leadership [22][24] This summary encapsulates the key points discussed during the conference call, highlighting Emerson Electric's performance, market conditions, strategic focus, and future outlook.

Financial Data and Key Metrics Changes - Emerson's underlying sales growth was 2% year-over-year, with adjusted segment EBITDA margin at 27.7% and adjusted earnings per share at $1.46, reflecting a 6% increase year-over-year [10][19][24] - The backlog ended the quarter at $7.9 billion, up 9% year-over-year, with a book-to-bill ratio of 1.13 [19][63] Business Line Data and Key Metrics Changes - Software and systems reported a 3% underlying sales growth, driven by test and measurement, which grew 11% [19][23] - Intelligent devices grew 2%, while safety and productivity increased by 1% [19][24] - Ovation business saw a significant increase of 74% in orders, driven by large project wins [14][40] Market Data and Key Metrics Changes - North America orders were up 18%, with strong performance in power and LNG sectors [38][97] - The Middle East and Africa experienced a 9% growth, while Europe and China showed ongoing softness [14][38][75] Company Strategy and Development Direction - Emerson aims to return $10 billion to shareholders through share repurchase and dividends, with a focus on organic growth and operational excellence [7][11] - The company is aligned with secular tailwinds such as electrification, energy security, and nearshoring, expecting these to drive growth over the next three years [5][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 targets, supported by a good start to the year and operational excellence [10][11] - The company anticipates continued strong demand in North America, India, and the Middle East, while acknowledging challenges in Europe and China [14][75] Other Important Information - Emerson was named the 2026 Industrial IoT Company of the Year, highlighting its leadership in industrial IoT technology [11] - The company released DeltaV version 16, enhancing its software-defined automation vision [12] Q&A Session Summary Question: Can you break down the 9% order growth in Q1 between process and hybrid? - Management noted that power orders were driven by modernization and behind-the-meter power generating capacity at data centers, with significant growth in test and measurement orders [34][36][40] Question: What is the expected impact of AI on software growth? - Management believes AI capabilities will accelerate growth in software offerings, with minimal disruption expected [41][43] Question: Are the orders in power pushing beyond this year into multi-year phases? - Management confirmed confidence in backlog timing supporting sales into 2027, particularly in power and LNG sectors [46][47] Question: What is the outlook for weak verticals like chemicals? - Management indicated continued flat activity in Europe, particularly in chemicals, with a bearish outlook for China [75][76] Question: What is the opportunity in Venezuela? - Management acknowledged a long-established history in Venezuela and plans to mobilize for potential growth, particularly in power generation [104][106] Question: Any updates on tariffs and mitigation activity? - Management reported some positive developments regarding tariffs, particularly with China, while noting challenges with Mexico [115] Question: What are the green shoots in China? - Management highlighted good activity in the test and measurement space and broad portfolio business, despite overall softness [117]

Financial Data and Key Metrics Changes - In Q1 2026, underlying sales increased by 2% year-over-year, with adjusted segment EBITDA margin at 27.7% and adjusted earnings per share (EPS) at $1.46, reflecting a 6% increase year-over-year [9][10][17] - The company expects full-year sales growth of approximately 4% and adjusted EPS guidance raised to $6.40-$6.55 per share [10][23] Business Line Data and Key Metrics Changes - The software and systems segment saw underlying sales growth of 3%, driven by strong performance in test and measurement, which grew 11% [20][24] - Intelligent devices grew by 2%, while safety and productivity increased by 1% [20][22] - The Ovation business experienced a significant increase of 74% in orders, driven by large project wins [12][29] Market Data and Key Metrics Changes - North America, India, and the Middle East and Africa showed robust demand, with North America orders up 18% [12][32] - Europe and China experienced ongoing softness, with orders in Europe down low single digits and China down high single digits [12][32] - The overall order growth was 9%, with significant contributions from power and LNG sectors [12][29] Company Strategy and Development Direction - The company aims to return $10 billion to shareholders through share repurchases and dividends, with a focus on organic growth and operational excellence [5][10] - Emerson's automation portfolio is aligned with secular trends such as electrification and energy security, expected to drive growth over the next three years [4][5] - The company is committed to enhancing adjusted segment EBITDA margins by 240 basis points by 2028 [4] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 targets, supported by a strong start to the year and operational excellence [9][10] - The company noted that AI capabilities integrated into their software offerings are expected to accelerate growth rather than disrupt it [33] - Concerns were raised about the softness in Europe and China, particularly in the chemical sector, but there are signs of growth in test and measurement and power generation [44][60] Other Important Information - Emerson completed $250 million in share repurchases in Q1 and plans to return approximately $2.2 billion to shareholders [10][23] - The company was recognized as the 2026 Industrial IoT Company of the Year, highlighting its leadership in industrial IoT technology [10] Q&A Session Summary Question: Can you break down the 9% order growth in Q1 between process and hybrid? - Management noted that the growth was predominantly driven by modernization and behind-the-meter power generating capacity at data centers, with significant activity in test and measurement [29][30] Question: What are the expectations for the impact of AI on software growth? - Management indicated that AI capabilities are expected to complement and accelerate growth in software offerings, with minimal disruption anticipated [33] Question: How should we think about the cadence of longer-cycle orders translating into sales? - Management stated that the backlog supports mid-single-digit growth and that the build is across various business segments, particularly in control systems and software [40] Question: What is the outlook for the chemical sector in Europe and China? - Management acknowledged continued flat activity in Europe, particularly in chemicals, and a bearish outlook for China, with expectations of low single-digit declines [44][60] Question: What is the company's strategy regarding the opportunity in Venezuela? - Management highlighted a long-established history in Venezuela and plans to mobilize resources to capitalize on potential growth opportunities in the region, particularly in power generation [54][56]

2026 Q1 Earnings February 3, 2026 EMERSON | 1 Safe Harbor Statement Statements in this presentation and our commentary and responses to questions that are not strictly historical may be "forward-looking" statements, which represent management's expectations, based on currently available information. Actual results, performance or achievements could differ materially from those expressed in any forward-looking statement. Any forward-looking statements in this presentation speak only as of the date of this pr ...

Summary of Emerson Electric's 2025 Investor Conference Company Overview - **Company**: Emerson Electric (NYSE: EMR) - **Date of Conference**: November 20, 2025 - **Key Theme**: Engineering the Autonomous Future Key Points Industry Transformation - Emerson has transformed into a global automation leader, focusing on engineering solutions for the autonomous future [2][12][17] - The company has undergone significant portfolio changes, divesting non-core businesses and investing in industrial software [12][18] Financial Metrics - Emerson's revenues are now approximately **$18 billion**, with **52.8% gross margins** and **27.6% adjusted segment EBITDA margins** [21][18] - Software now constitutes **14%** of total revenues, growing at a low double-digit rate [18][21] - The company has achieved **18 consecutive quarters of growth**, with a **CAGR of 7%** over the last five years [20][21] Segment Reorganization - Emerson has reorganized its reporting structure into five segments, focusing on automation, software, and intelligent devices [3][4][5] - The automation portfolio accounts for about **90%** of sales, while safety and productivity segments make up the remaining **10%** [4][5] Growth Strategy - The company aims for a revenue target of **$21 billion** by 2028, driven by organic growth in its control, intelligent devices, and safety productivity segments [29][52] - Key growth markets include power, liquefied natural gas, life sciences, semiconductors, and aerospace and defense, which collectively represent **22%** of current revenue [41][47] Market Opportunities - **Power**: Significant investments in U.S. power generation, with a projected **30% increase** in generating capacity by 2030 [42] - **Liquefied Natural Gas**: Entering a third wave of investment, with **585 million tons per annum** of capacity expected [43] - **Life Sciences**: Strong growth driven by advancements in drug development and over **$350 billion** in committed investments for reshoring manufacturing [44] - **Semiconductors**: Positioned strongly with nine of the top ten semiconductor companies standardized on NI for validation and production testing [45] - **Aerospace and Defense**: A growing market with a projected size of nearly **$1 trillion** by 2030 [47] Operational Excellence - Emerson has improved its operational margins by **700 basis points** over the last four years, with a target of reaching **30% adjusted segment EBITDA margins** by 2028 [48][62] - The company emphasizes a disciplined pricing culture and operational efficiencies to drive margin improvements [49][62] Innovation and Technology - Emerson is investing **8% of revenue** in innovation, with a focus on software-defined technology and AI integration [38][40] - The company has established **15 major innovation hubs** and employs over **14,000 engineers** to drive technological advancements [39][40] Customer Base and Resilience - Emerson serves over **125,000 active customers**, with minimal concentration risk; the largest customer accounts for only **1.5%** of sales [24] - The installed base is valued at **$155 billion**, with a replacement rate of about **8%** annually, providing a stable revenue stream [22][23] Capital Allocation - Emerson plans to return **70%** of its cash flow to shareholders through dividends and share repurchases, with a projected **$10 billion** in cash flow over the next three years [51][52] - The company has committed to a **$1 billion** share repurchase program in 2025, with additional repurchases planned for 2027 and 2028 [51] Conclusion - Emerson Electric is positioned for significant growth and value creation through its focus on automation, innovation, and operational excellence, aiming to lead in the evolving landscape of industrial automation [12][52]

Core Insights - Zacks Premium offers tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores provide a framework for evaluating stocks based on value, growth, and momentum characteristics [2][3][4][5][6] Zacks Style Scores - The Style Scores categorize stocks into Value, Growth, Momentum, and a combined VGM Score, with ratings from A to F indicating potential performance [3][4][5][6] - Value Score focuses on identifying undervalued stocks using financial ratios [3] - Growth Score assesses a company's financial health and future growth potential [4] - Momentum Score evaluates stocks based on price trends and earnings estimate changes [5] - VGM Score combines the three styles to identify stocks with the best overall potential [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to help investors build successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically outperformed the S&P 500, with an average annual return of +23.81% since 1988 [8] - A large number of stocks can have high Zacks Ranks, making it essential to use Style Scores for selection [9] Stock Example: Emerson Electric (EMR) - Emerson Electric is a diversified global engineering and technology company with significant operations in the Americas, AMEA, and Europe [12] - EMR holds a Zacks Rank of 3 (Hold) and has a VGM Score of B, with a strong Momentum Style Score of A [13] - Recent earnings estimates for EMR have been revised upward, indicating positive momentum [13][14]

Company Overview - Emerson Electric Co. is a diversified global engineering and technology company headquartered in St. Louis, MO, offering a wide range of products and services across consumer, commercial, and industrial markets [11] - The company operates under various brands including Bettis, Crosby, Fisher, Flexim, Micro Motion, and DeltaV, with geographical revenue distribution of 50% from the Americas, 30% from AMEA, and 20% from Europe [11] Investment Analysis - Emerson Electric is currently rated 3 (Hold) on the Zacks Rank, with a VGM Score of B, indicating a moderate investment outlook [12] - The company has a Momentum Style Score of A, with shares having increased by 0.1% over the past four weeks [12] - An upward revision in earnings estimates for fiscal 2025 has been noted, with the Zacks Consensus Estimate rising to $6.00 per share [12] - Emerson Electric has an average earnings surprise of +3.4%, suggesting a potential for positive performance relative to expectations [12] - Given its solid Zacks Rank and strong Momentum and VGM Style Scores, Emerson Electric is recommended for investors' consideration [13]

Financial Data and Key Metrics Changes - Emerson reported underlying orders growth of 4%, exceeding expectations, with all regions showing positive results, including China [6][12] - Underlying sales were up 2%, with Process and Hybrid businesses growing mid-single digits, while adjusted earnings per share increased by 9% year over year to $1.48 [12][24] - Free cash flow was $738 million, reflecting a 14% increase year over year, with a free cash flow margin of 17% [24][25] Business Line Data and Key Metrics Changes - Process and Hybrid markets grew by 6%, while Discrete businesses turned positive with Test and Measurement orders up 8% [6][14] - Software and Control segment grew by 7%, driven by higher software sales, while Intelligent Devices remained flat due to safety and productivity issues [22] - The Industrial Software business saw an 11% year-over-year increase in annual contract value (ACV), supported by strong demand for AspenTech's offerings [21] Market Data and Key Metrics Changes - Demand for Process and Hybrid businesses remained strong, particularly in energy and LNG projects, with significant capital investment noted in regions like the Middle East, Africa, and India [14][18] - The Americas experienced mid-single-digit growth, while Europe saw low single-digit growth, with continued momentum in Energy Transition and Life Sciences [18][19] - The company expects mid-single-digit growth in Process and Hybrid sales in the second half, with a more muted recovery anticipated in factory automation and automotive sectors [20][36] Company Strategy and Development Direction - Emerson is focused on integrating AspenTech as a key priority for 2025, targeting $100 million in cost synergies by 2028 [10] - The company has completed its portfolio transformation, retaining the Safety and Productivity business due to its strong profitability and cash generation potential [11] - Emerson aims to maintain disciplined capital allocation, prioritizing reinvestment in the business, dividends, and share repurchases while targeting bolt-on acquisitions under $1 billion [39][96] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's plans for the year, guiding for underlying sales growth of approximately 4% and raising the midpoint of adjusted EPS guidance to between $5.90 and $6.05 [9][34] - The management noted that while there are signs of tariff-induced impacts, they have not seen widespread indications affecting demand [16][32] - The company anticipates a favorable spending environment in LNG and power sectors, driven by energy security and self-reliance commitments [16][36] Other Important Information - Emerson's gross exposure to tariffs is estimated at $245 million for 2025, which the company expects to fully mitigate through pricing actions and operational adjustments [7][31] - The company reported a backlog of $7.5 billion, with a book-to-bill ratio of 1.04, indicating a healthy order flow [22] Q&A Session Summary Question: What is improving in discrete automation? - Management highlighted recovery in Test and Measurement driven by Aerospace and Defense, while noting continued weakness in automotive sectors, particularly in China and Germany [42][44] Question: How real is the pharmaceutical spending? - Management confirmed that the commitments from pharmaceutical companies are genuine, with early projects emerging in the life sciences sector [46][48] Question: What can be done with AspenTech now that the deal is closed? - Management expressed excitement about the growth opportunities with AspenTech, emphasizing the potential for double-digit ACV growth and enhanced collaboration with existing Emerson platforms [53][55] Question: Will tariff impacts be offset by the end of the fiscal year? - Management confirmed that they expect to completely cover the tariff impacts by the end of fiscal 2025 [57][59] Question: Why retain the Safety and Productivity business? - Management concluded that retaining the business would provide the best value for shareholders, given its strong profitability and alignment with U.S. manufacturing trends [66][68] Question: What data points indicate softness in China? - Management noted that softness is primarily in the chemical sector, with some positive signs in power generation and marine business [70][72] Question: What is the outlook for Test and Measurement? - Management indicated strong growth in Aerospace and Defense and a recovery in semiconductors, while automotive remains a concern [92][94]