Trade-Ideas LLC identified

Emerson Electric

(

EMR

) as a strong on high relative volume candidate. In addition to specific proprietary factors, Trade-Ideas identified Emerson Electric as such a stock due to the following factors:

  • EMR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $289.8 million.
  • EMR has traded 469,722 shares today.
  • EMR is trading at 2.49 times the normal volume for the stock at this time of day.
  • EMR is trading at a new high 3.01% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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More details on EMR:

Emerson Electric Co. designs and manufactures products, and delivers services to industrial, commercial, and consumer markets worldwide. The stock currently has a dividend yield of 4.1%. EMR has a PE ratio of 12. Currently there are 2 analysts that rate Emerson Electric a buy, 2 analysts rate it a sell, and 14 rate it a hold.

The average volume for Emerson Electric has been 4.7 million shares per day over the past 30 days. Emerson Electric has a market cap of $29.9 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.15 and a short float of 3.9% with 4.19 days to cover. Shares are down 24.1% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Emerson Electric as a

buy

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity, expanding profit margins, impressive record of earnings per share growth and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electrical Equipment industry. The net income increased by 58.0% when compared to the same quarter one year prior, rising from $410.00 million to $648.00 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Electrical Equipment industry and the overall market, EMERSON ELECTRIC CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • 43.45% is the gross profit margin for EMERSON ELECTRIC CO which we consider to be strong. Regardless of EMR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, EMR's net profit margin of 11.14% compares favorably to the industry average.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 20.9%. Since the same quarter one year prior, revenues fell by 14.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • EMERSON ELECTRIC CO reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, EMERSON ELECTRIC CO increased its bottom line by earning $3.99 versus $3.03 in the prior year. For the next year, the market is expecting a contraction of 22.9% in earnings ($3.08 versus $3.99).

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