Rockwell Automation logged a 1.1% change during today's morning session, and is now trading at a price of $261.36 per share.
Rockwell Automation returned gains of 7.0% last year, with its stock price reaching a high of $348.52 and a low of $240.31. Over the same period, the stock underperformed the S&P 500 index by -9.0%. As of April 2023, the company's 50-day average price was $286.76. Rockwell Automation, Inc. provides industrial automation and digital transformation solutions in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. Based in Milwaukee, WI, the large-cap Industrials company has 29,000 full time employees. Rockwell Automation has offered a 1.8% dividend yield over the last 12 months.
Growing Revenues With a Flat Capital Expenditure Trend:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $6,666 | $6,695 | $6,330 | $6,997 | $7,760 | $8,498 |
| Gross Margins | 43% | 43% | 41% | 41% | 40% | 41% |
| Operating Margins | 20.0% | 13.0% | 18.0% | 22.0% | 14.0% | 18.0% |
| Net Margins | 8.0% | 10.0% | 16.0% | 19.0% | 12.0% | 15.0% |
| Net Income (MM) | $536 | $696 | $1,023 | $1,358 | $932 | $1,281 |
| Net Interest Expense (MM) | $73 | $98 | $104 | $95 | $123 | $132 |
| Depreciation & Amort. (MM) | $136 | $126 | $122 | $124 | $127 | $128 |
| Earnings Per Share | $4.21 | $5.83 | $8.77 | $11.58 | $7.97 | $11.0 |
| Diluted Shares (MM) | 127 | 119 | 117 | 117 | 117 | 114 |
| Free Cash Flow (MM) | $1,174 | $1,049 | $1,007 | $1,141 | $682 | $796 |
| Capital Expenditures (MM) | $126 | $133 | $114 | $120 | $141 | $138 |
| Net Current Assets (MM) | -$742 | -$909 | -$1,165 | -$1,072 | -$999 | -$596 |
| Long Term Debt (MM) | $1,235 | $1,953 | $1,980 | $3,465 | $2,868 | $0 |
| Net Debt / EBITDA | 0.84 | 1.32 | 1.09 | 2.13 | 2.96 | 0.27 |
Rockwell Automation benefits from growing revenues and a flat capital expenditure trend, low leverage, and wider gross margins than its peer group. The company's financial statements show decent operating margins with a stable trend and a strong EPS growth trend. Furthermore, Rockwell Automation has irregular cash flows.
Rockwell Automation's Valuation Is in Line With Its Sector Averages:
Rockwell Automation has a trailing twelve month P/E ratio of 24.0, compared to an average of 20.49 for the Industrials sector. Based on its EPS guidance of $13.22, the company has a forward P/E ratio of 21.7. The company doesn't provide forward earnings guidance, and the compound average growth rate of its last 6 years of reported EPS is 17.4%. On this basis, Rockwell Automation's PEG ratio is 1.38. Using instead the 9.9% weighted average of Rockwell Automation's earnings CAGR and the broader market's anticipated 5-year EPS growth rate, the company's PEG ratio is 2.42, which suggests that its shares may be overpriced. Furthermore, Rockwell Automation is likely overvalued compared to the book value of its equity, since its P/B ratio of 8.48 is higher than the sector average of 3.78. The company's shares are currently trading 206.2% above their Graham number.
Rockwell Automation Has an Average Rating of Hold:
The 18 analysts following Rockwell Automation have set target prices ranging from $220.0 to $375.0 per share, for an average of $311.78 with a hold rating. As of April 2023, the company is trading -8.0% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Rockwell Automation has an average amount of shares sold short because 2.8% of the company's shares are sold short. Institutions own 82.8% of the company's shares, and the insider ownership rate stands at 0.15%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 12% stake in the company is worth $3,566,290,976.
