Emerson Electric (EMR) reported disappointing quarterly results on Wednesday, pushing shares of the technology and engineering company down 5% and forcing a downgrade on our newest holding.
As a result, we are putting Emerson Electric in the "penalty box" and downgrading shares to a 2 rating from a 1.
A penalty box means the stock has one quarter to show improvement — and should it fail to do so, it gets booted from the portfolio.
Geographically, sales growth was driven by the Americas, which was up 13% versus the year-ago period.
On the other hand, the earnings-per-share guide, which along with underlying sales growth is in line with the guidance previously provided, came in a penny short at the midpoint.