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One of my mother’s favorite sayings was “It’s an ill wind that blows nobody any good.” (Lest anyone get the erroneous impression that my mother was an optimist, I’d note that another of her favorites was “Every silver lining has a cloud.”)

Which–the ill wind part–brings me to Emerson Electric (EMR). The company bought the Intelligent Platforms, Internet of Things, division of General Electric (GE) at the end of 2018 as a result of GE CEO Larry Culp’s drive to right-size/dismantle GE.

The acquisition is a reminder that Emerson Electric is the dominant U.S. player in automation for process manufacturing. After a very slight dip after the company announced earnings on February 5 (with 8.7% growth revenue came in light at $4.15 billion for the quarter against expectations for $4.21 billion but the company did bear revenue estimates by 8 cents a share), I will be adding the stock to my Jubak Picks Portfolio on February 7. The shares closed at %67.75 on February 6. My target price for the stock is $82. The shares pay a 2.93% dividend with an ex-dividend date of February 12.

The total addressable automation market in 2017 came to $204 billion with about $140 of that in devices, $40 billion in control and safety systems, and $20 billion in asset management. Despite its dominant position, Emerson has only 6%, 5%, and 2% share of each of those segments, according to Morningstar. Which gives the company lots of headroom for growth. Emerson’s installed based was about $100 billion, the largest in the industry.

But the profit picture is even brighter than the growth picture. The trend in the sector is to add more and more services to existing equipment–a trend that the acquisition of GE’s Internet of Things division should help accelerate at Emerson (the GE division had $210 million in sales in 2017.) Those service revenues generally carry a higher operating margin and should allow the company to increase companywide operating margins.

The big risk in Emerson is the company’s exposure to the oil and gas sector. Back in 2014-2016 about 30% of Emerson’s automation revenue came from the sector so the 75% drop in oil prices in that period, with the accompanying drop in spending by oil and gas companies, hit Emerson revenues hard. The company has reduced its percentage exposure to the oil and gas sector and a repeat of that 75% drop in the price of oil seems unlikely.

Morningstar estimates average annual revenue growth of about 8% over the next five years (with 5% organic growth and the remainder coming from acquisitions.)

On February 5 the company raised its guidance for fiscal 2019 to earnings of $3.60 to $3.75 a share (from the consensus forecast of $3.64) and raised its revenue estimates to $18.63 billion to $19.15 billion for the year from earlier guidance of $18.45 billion to %18.97 billion. (The Wall Street consensus estimate had been for $18.88 billion.)