Citigroup Reiterates Buy Rating, $55 PT on Emerson Electric Co.

In a report published Wednesday, Citigroup reiterated its Buy rating and $55.00 on Emerson Electric Co.

. Citigroup noted, “Buy-rated Emerson reported a headline 4Q12 beat led by backlogged Process sales and a tax benefit. It also provided the first broad-stroke full-year FY 2013 guidance ahead of its February Analyst Day. Given slowing orders and macro headwinds, investors had muted expectations for the low-single-digit core growth and mid-single-digit EPS growth and maybe even worse. Emerson expects some bright spots, including continued strength in Process and a pickup in construction markets. In our view, part of the +2% positive stock reaction came from the announcement of the planned divestiture of the troubled Embedded Power business. The setup remains attractive as Emerson shows progress in its turnaround, and valuation still looks compelling below the low-end of its historical relative P/E range. We are reducing our F2013 EPS estimate by $0.08 but maintain our $55 target price.” Emerson Electric Co. closed on Tuesday at $51.46.