(Adds details on results, CEO, analyst comments, shares)
By Lewis Krauskopf
Aug 5 Emerson Electric Co posted
lower-than-expected quarterly profit and sales on Tuesday,
pointing to "persisting economic challenges," and said its
full-year results would come in at the low end of its
Shares of the U.S. automation and power supply systems maker
slipped 1.4 percent to $63.07 in morning trade on the New York
Emerson's report comes at the end of an uneven reporting
season for diverse U.S. manufacturers, most of whose shares have
underperformed the broader market since the second quarter
ended. Some analysts said Emerson's weak results were somewhat
expected by investors, given the earlier sluggish reports by
"Fundamentals continue to gradually strengthen, but
persisting economic challenges in some markets and rising
geopolitical tension have hampered growth, which is not expected
to improve in the near term," Emerson Chief Executive Officer
David Farr said in a statement.
Net earnings attributable to common shareholders rose to
$728 million, or $1.03 per share, in the company's fiscal third
quarter ended June 30, from $194 million, or 27 cents per share,
a year earlier.
Analysts on average were looking for $1.06 per share,
according to Thomson Reuters I/B/E/S.
Emerson said earnings were 3 cents per share lower due to
"difficult tax rate comparisons."
Revenue fell 0.5 percent to $6.31 billion, below the $6.45
billion expected by analysts.
"None of the core businesses beat expectations," JP Morgan
analyst Stephen Tusa said in a research note. Tusa noted that
the Process Management segment, the company's largest division,
was most off target, with sales rising 2 percent against his 5
Emerson said its fiscal-year results were pointing toward
the low end of its forecast of earnings in a range of $3.68 to
$3.80 per share on underlying sales growth of 3 percent to 5
But it did say it expected fourth-quarter order trends to
improve to growth of 5 percent to 7 percent, led by better
conditions in emerging markets and firming demand in the United
(Reporting by Lewis Krauskopf in New York and Ankit Ajmera in
Bangalore; Editing by Savio D'Souza and W Simon)