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Emerson Electric Cuts Sales Forecast on Currency Effects (EMR)

Electrical components maker Emerson Electric Co. (EMR) on Tuesday lowered its fiscal fourth quarter sales outlook, citing negative currency effects amid a stronger dollar.

The St. Louis-based company said that currency fluctuations would eat into its fiscal fourth quarter sales by $120 million. Still, EMR left its full-year EPS outlook of $3.35 to $3.50 in tact.

EMR commented via a filing with the SEC, “Emerson’s trailing three-month orders declined 2 percent, principally due to the significantly stronger U.S. dollar. Orders excluding currency were up 3 percent. The reduced underlying growth rate reflects the protracted European financial crisis, concern by U.S. businesses and consumers over the prospective December 31 U.S. fiscal ‘cliff’, and generally slowing U.S. and Chinese economies. Robust growth in Process Management and solid trends in Commercial & Residential Solutions offset negative results in the other businesses.”

Emerson Electric shares were mostly flat in premarket trading Tuesday.

The Bottom Line
Shares of Emerson Electric (EMR) have a 3.59% dividend yield, based on last night’s closing stock price of $45.56. The stock has technical support in the $41-$42 price area. If the shares can firm up, we see overhead resistance around the $48-$50 price levels.

Emerson Electric Co. (EMR) is not recommended at this time, holding a DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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