Emerson Announces Adoption Of Thermal Energy Harvesting

In a bid to further expand its huge industrial wireless portfolio, Emerson Electric Co. (NYSE:EMR) announced that it has adopted harness advanced thermal energy harvesting to meet power requirements of its wireless products.

Emerson uses Perpetua’s Power Puck thermoelectric energy harvesters, which convert ambient heat emitted in industrial processes into electric energy, for the Rosemount wireless transmitters.

The Power Puck thermoelectric energy harvester delivers reliable power throughout the life of the transmitter and includes an intrinsically safe power module with a battery shelf life of 10 years for backup power.

The energy harvesting solution has particular relevance for wireless devices in power-intensive applications, where a conventional power module may require replacements more frequently. This convenient, sustainable energy harvesting solution can be integrated into a broad range of applications, as it enables users to reduce maintenance costs.

Emerson is undergoing a restructuring phase. Earlier this month, Emerson announced an agreement to purchase Pentair Valves & Controls, a business unit of Pentair plc. This buyout is part of the company’s diligent portfolio repositioning strategy that began in 2015 to drive efficiency and growth. Worth $3.15 billion, the proposed acquisition came on the heels of the company’s announcement of the spin-off of its Network Power, Leroy-Somer and Control Techniques businesses.

In its recent earnings release, Emerson lowered its fiscal 2016 revenue and earnings estimates as it continued to grapple with difficult business conditions. Also, in light of its planned divestitures, Emerson stands to lose over $6 billion in annualized sales, which will reduce its revenue base significantly.

Business investment growth has also been in the negative over the last nine months and the company expects this trend to continue up to 2017, adding to its woes. Given such tough economic conditions and dwindling order numbers, the company anticipates underlying sales to be down 5–6% in the fiscal year. Moreover, stiff competition and escalating restructuring expenses may weigh on its financials in the near term.

We expect Emerson’s performance to remain under pressure in the coming quarters, as it contends with critical headwinds including sustained weak global economic circumstances, depressed industrial spending along with soft emerging and mature economies.

Emerson currently has a Zacks Rank #5 (Strong Sell). Better-ranked stocks in the same space include Franklin Electric Co., Inc. (NASDAQ:FELE) , AO Smith Corp. (NYSE:AOS) and EnerSys (NYSE:ENS) , each carrying a Zacks Rank #2 (Buy).

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