NYSE$EMR

Emerson Electric Co · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Third quarter results reported with updated full-year guidance reflecting dynamic demand environment and stronger cost savings.

Emerson reported a decrease in GAAP net sales by 16 percent to $3.9 billion, with underlying sales down 15 percent due to COVID-19 impacts. GAAP EPS was $0.67, a 31 percent decrease, while adjusted EPS was $0.80, exceeding management guidance due to cost reduction actions and a lower effective tax rate. The company delivered strong operating and free cash flow, initiated restructuring actions, and updated its full-year guidance as cost savings take effect and demand begins to stabilize.

  • GAAP net sales decreased by 16 percent, with underlying sales down 15 percent due to COVID-19 impacts.
  • GAAP EPS was $0.67, down 31 percent, while adjusted EPS was $0.80, exceeding guidance.
  • Operating cash flow was $842 million, and free cash flow was $738 million for the quarter.
  • Full-year guidance was updated to reflect cost savings and stabilizing demand.

Headline financials

Total Revenue

$3.91B

Previous: $4.68B-16.4%
EPS (adj)

$0.80

Previous: $0.94-14.9%
Capital Expenditures

-$329M

Previous: -$395M+16.7%
Free Cash Flow

$70M

Previous: $209M-66.5%
Net Income

$399M

Previous: $604M-33.9%
Operating Income

-$3.32B

Previous: -$3.83B+13.3%
Gross Profit

$1.62B

Previous: $2B-19.1%
Cash & Equivalents

$2.45B

Previous: $1.6B+52.8%
Total Assets

$21.7B

Previous: $21.3B+1.9%
Stock-Based Comp

$51M

Previous: $31M+64.5%

Revenue & EPS history

Emerson · Revenue · Quarterly

$3.91B

Q3 2020-16.4%vs Q3 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Emerson · $3.15B total across 1 segment · Q4 2023

  • Intelligent Devices
    $3.15B

Forward guidance

Emerson updated the full year 2020 outlook to reflect the dynamic demand environment associated with global economic reopening and the stronger cost savings impacts.

Tailwinds

  • Guidance assumes a continued challenging but steadily improving demand environment in the fourth quarter
  • Expect revenue to return to growth in either the second or third quarter of 2021
  • The updated guidance also assumes no major operational or supply chain disruptions
  • Guidance assumes no changes in discrete tax items
  • Guidance assumes oil prices remain in the approximately $35 to $45 range

Headwinds

  • Scope, duration and ultimate impact of the COVID-19 pandemic
  • Economic and currency conditions
  • Market demand, including related to the pandemic and oil and gas price declines and volatility
  • Pricing
  • Competitive and technological factors

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

-0.3%

Avg return

Earnings day

+1.7%

Avg return

5 days after

+1.5%

Avg return

30 days after

40%

29 / 73 earnings

Positive

+15.5%

Q4 2024

Best reaction

-7.6%

Q4 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+6.8%+4.3%+2.5%
Q1 2026-1.0%+5.2%-9.0%
Q4 2025-3.9%+2.1%+3.8%
Q3 2025-0.8%-0.7%-1.0%
Q2 2025+2.4%+11.3%+15.1%
Q1 2025-2.3%-0.7%-7.1%
Q4 2024+15.5%+15.9%+21.3%
Q3 2024-2.9%-4.4%-8.9%
Q2 2024+7.6%+6.9%+0.5%
Q1 2024+8.6%+10.6%+16.9%
Q4 2023-7.6%-5.7%-3.3%
Q3 2023+4.6%+6.1%+8.0%
Q2 2023+0.6%+1.9%+0.7%
Q1 2023-6.6%-4.7%-9.9%
Q4 2022-1.8%+2.8%+2.3%
Q3 2022-2.8%-0.9%-7.1%
Q2 2022-1.4%-6.7%-0.2%
Q1 2022+4.4%+3.5%-1.0%
Q4 2021-3.0%-2.4%-9.9%
Q3 2021-0.1%+0.0%+4.2%
Q2 2021+2.9%+4.7%+7.8%
Q1 2021+3.5%+6.5%+9.5%
Q4 2020+0.3%+3.2%+11.1%
Q3 2020+3.1%+5.7%+9.5%
Q2 2020+2.3%+5.7%+10.5%
Q1 2020+4.7%+1.6%-10.8%
Q4 2019+0.5%+0.9%+1.0%
Q3 2019+0.2%+0.1%+4.0%
Q2 2019-5.5%-4.6%-10.7%
Q1 2019-0.9%-1.3%-0.5%
Q4 2018-0.7%-2.6%-9.3%
Q3 2018+3.4%+3.1%+6.4%
Q2 2018+1.8%+3.0%+6.7%
Q1 2018+0.8%+0.9%+2.6%
Q4 2017-3.1%-4.5%+2.0%
Q3 2017+2.3%+2.6%-1.0%
Q2 2017-1.8%-2.4%-1.9%
Q1 2017+4.3%+5.7%-1.0%
Q4 2016-1.3%-2.5%+12.0%
Q3 2016-5.1%-3.8%-5.8%
Q2 2016-4.4%
Q1 2016+1.3%
Q4 2015+2.8%
Q3 2015-2.8%
Q2 2015-2.1%
Q1 2015-2.8%
Q4 2014-0.2%
Q3 2014-3.3%
Q2 2014-0.6%
Q1 2014-0.8%
Q4 2013+0.1%
Q3 2013-1.1%
Q2 2013-0.2%
Q1 2013-0.1%
Q4 2012-0.4%
Q3 2012+2.1%
Q2 2012-5.8%
Q1 2012-2.5%
Q4 2011-3.8%
Q3 2011-6.3%
Q2 2011-3.3%
Q1 2011-0.2%
Q4 2010+1.0%
Q3 2010-0.6%
Q2 2010-3.5%
Q1 2009-3.2%
Q1 2010+0.0%
Q4 2009+1.4%
Q2 2009+1.4%
Q3 2009-3.8%
Q3 2008-3.8%
Q4 2007-3.8%
Q4 2008-3.8%

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