Emerson Electric (NYSE: EMR) reported Q4 EPS of $0.77, $0.02 worse than the analyst estimate of $0.79. Revenue for the quarter came in at $4.44 billion versus the consensus estimate of $4.45 billion.

2018 Outlook

In fiscal 2018, the Company expects oil and gas prices to remain stable in a range favorable for energy related markets, while growth in air conditioning, refrigeration and global construction markets is expected to continue. Automation Solutions net sales are expected to be up 14 to 16 percent, with underlying sales up 5 to 7 percent excluding an impact from acquisitions and currency translation of 9 percent. Commercial & Residential Solutions net sales are expected to be down 1 percent to up 1 percent and underlying sales are expected to be up 3 to 5 percent excluding the impact of the ClosetMaid divestiture and currency translation of 4 percent.

Total Emerson net sales are expected to be up 8 to 10 percent, with underlying sales up 4 to 6 percent excluding a 4 percent impact from acquisitions, divestitures and currency translation. Reported (GAAP) net earnings per share are expected to be $2.66 to $2.86. Adjusted net earnings per share are expected to be $2.75 to $2.95, excluding a ($0.03) impact from Valves & Controls first year acquisition accounting charges related to inventory and backlog amortization, and a ($0.06) impact from a tax-related loss on the divestiture of the ClosetMaid business, which occurred early in the first quarter of fiscal 2018. As a result of the divestiture, the first quarter tax rate is expected to be approximately 40 percent.

“Market conditions began trending favorably for Emerson in the second half of 2017, and we expect 2018 to continue that trajectory,” said Farr. “With a strong foundation for growth and increasing momentum in global markets, I look forward to seeing our teams deliver results for our shareholders - strong cash flow and adjusted net earnings per share of $2.75 to $2.95.”

GUIDANCE:

Emerson Electric sees FY2018 EPS of $2.75-$2.95, versus the consensus of $2.92.

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