Goldman Sachs has raised its "Neutral" rating on Emerson Electric (NYSE:EMR) and added it to the Conviction Buy List. Goldman based the upgrade on positive earnings outlook and an attractive risk versus rewards analysis. Its 2008 and 2008 estimates were raised and it now sees 12% upside to the $52.00 prior target with a new target set at $58.00. Goldman Sachs also noted that Emerson is one of its six well positioned multi-industry primes at this stage of the cycle and lists catalysts as upward earnings revisions and even lists M&A in the fold. As a "flight from the dollar" this works as well, because Goldman Sachs lists 52% of sales being non-U.S and noted exposure to oil and gas.
On the reverse, Goldman Sachs downgraded Danaher Corp. (NYSE:DHR) to Neutral and downgraded Tyco International (NYSE:TYC) to a "SELL" rating.
Emerson Electric shares are trading up over 2% pre-market at $52.75. Danaher shares are down 1% at $82.00 pre-market and Tyco shares are trading down 1.5% at $44.00 in pre-market activity.
Jon C. Ogg
September 27, 2007