Emerson Electric Co., FCFF calculation

US$ in millions

12 months ended:	Sep 30, 2019	Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014
Net earnings common stockholders	2,306)	2,203)	1,518)	1,635)	2,710)	2,147)
Noncontrolling interests in earnings of subsidiaries	22)	21)	32)	29)	23)	37)
Net noncash charges	828)	751)	980)	742)	(62)	1,394)
Changes in operating working capital	(150)	(83)	160)	93)	(142)	114)
Cash provided by operating activities	3,006)	2,892)	2,690)	2,499)	2,529)	3,692)
Interest paid on all debt, net of tax¹	159)	147)	138)	146)	129)	137)
Capital expenditures	(594)	(617)	(476)	(447)	(685)	(767)
Free cash flow to the firm (FCFF)	2,571)	2,422)	2,352)	2,198)	1,973)	3,062)

Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30).

¹ See details »

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Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Emerson Electric Co. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Emerson Electric Co. FCFF increased from 2017 to 2018 and from 2018 to 2019.

Emerson Electric Co., interest paid, net of tax calculation

US$ in millions

12 months ended:	Sep 30, 2019	Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014
Effective Income Tax Rate (EITR)
EITR¹	18.60%	23.70%	28.30%	30.10%	34.30%	34.80%
Interest Paid, Net of Tax
Interest paid on all debt, before tax	195)	193)	192)	209)	196)	210)
Less: Interest paid on all debt, tax²	36)	46)	54)	63)	67)	73)
Interest paid on all debt, net of tax	159)	147)	138)	146)	129)	137)

Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30).

¹ See details »

² 2019 Calculation
Interest paid on all debt, tax = Interest paid on all debt × EITR
= 195 × 18.60% = 36

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Emerson Electric Co., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	36,423)
Free cash flow to the firm (FCFF)	2,571)
Valuation Ratio
EV/FCFF	14.17
Benchmarks
EV/FCFF, Competitors¹
Boeing Co.	21.58
Caterpillar Inc.	16.98
Cummins Inc.	15.76
Eaton Corp. plc	42.93
General Electric Co.	35.37
Honeywell International Inc.	28.59
Lockheed Martin Corp.	18.26
RTX Corp.	25.70
EV/FCFF, Sector
Capital Goods	28.35
EV/FCFF, Industry
Industrials	37.83

Based on: 10-K (reporting date: 2019-09-30).

¹ Click competitor name to see calculations.

If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

Emerson Electric Co., historical EV/FCFF calculation, comparison to benchmarks

	Sep 30, 2019	Sep 30, 2018	Sep 30, 2017	Sep 30, 2016	Sep 30, 2015	Sep 30, 2014
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	48,778)	46,577)	40,322)	38,847)	36,569)	47,420)
Free cash flow to the firm (FCFF)²	2,571)	2,422)	2,352)	2,198)	1,973)	3,062)
Valuation Ratio
EV/FCFF³	18.97	19.23	17.15	17.67	18.54	15.49
Benchmarks
EV/FCFF, Competitors⁴
Boeing Co.	—	—	—	—	—	—
Caterpillar Inc.	16.84	—	—	—	—	—
Cummins Inc.	10.35	—	—	—	—	—
Eaton Corp. plc	15.50	—	—	—	—	—
General Electric Co.	15.85	—	—	—	—	—
Honeywell International Inc.	21.13	—	—	—	—	—
Lockheed Martin Corp.	21.21	—	—	—	—	—
RTX Corp.	21.94	—	—	—	—	—
EV/FCFF, Sector
Capital Goods	23.83	—	—	—	—	—
EV/FCFF, Industry
Industrials	30.06	—	—	—	—	—

Based on: 10-K (reporting date: 2019-09-30), 10-K (reporting date: 2018-09-30), 10-K (reporting date: 2017-09-30), 10-K (reporting date: 2016-09-30), 10-K (reporting date: 2015-09-30), 10-K (reporting date: 2014-09-30).

¹ See details »

² See details »

³ 2019 Calculation
EV/FCFF = EV ÷ FCFF
= 48,778 ÷ 2,571 = 18.97

⁴ Click competitor name to see calculations.

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Valuation ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Emerson Electric Co. EV/FCFF ratio increased from 2017 to 2018 but then slightly decreased from 2018 to 2019.

Emerson Electric Co. (NYSE:EMR)

Enterprise Value to FCFF (EV/FCFF)

Free Cash Flow to The Firm (FCFF)

Interest Paid, Net of Tax

Enterprise Value to FCFF Ratio, Current

Enterprise Value to FCFF Ratio, Historical