I walk the tech beat at Hoover’s, covering semiconductors, test and measurement instruments, and all kinds of products that go into making the notebook computers, portable music players, and wireless phones you use daily.
Another facet of my portfolio, though, is industrial machinery: the metalworking equipment, power tools, and printing equipment found on factory floors and in big, dirty plants — quite the opposite of the antiseptic, quiet world of high technology. It’s my ying and my yang.
One firm that bridges these two worlds is Emerson Electric. The company has grown steadily over the years (from $14B in 1999 to $20B in 2006, with some hiccups in 2002-03) and consistently makes money, with net profit margins of 7-9% (except for 2002, a year of restructuring).
Emerson has a variety of businesses in its eight Emerson Brands segments. They include Astec Power (power supplies), ClosetMaid (storage products), Cooligy (electronics-cooling technology), Fisher Controls International (control valves and regulators), InterMetro Industries (cabinets, carts, and shelves), Liebert (cooling and power equipment), Ridgid (plumbing tools), and Therm-O-Disc (temperature sensors and controls).
As an industrial conglomerate, Emerson is in the second rank, behind behemoths like General Electric, Hitachi, and Siemens. Like those big ventures, Emerson is always in the hunt for companies and technologies to acquire (and making strategic divestitures, as well).
Emerson just agreed to buy Motorola’s Embedded Communications Computing business for $350M. The Motorola unit makes embedded computers for telecommunications networks and other applications. Earlier this year, Emerson acquired Decision Management International, which makes documentation software for FDA-regulated industries, and Stratos International, which makes electronic subsystems and components for communications networks.
Analysts look to Emerson to continue growing, through its existing operations and by acquisitions.
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