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Valued at a market cap of $33.4 billion, Rockwell Automation, Inc. (ROK) is a global leader in industrial automation and digital transformation, operating through three segments: Intelligent Devices, Software & Control, and Lifecycle Services. It serves diverse end markets, including automotive, food and beverage, life sciences, oil and gas, and renewable energy.
Shares of the industrial equipment and software maker have underperformed the broader market over the past 52 weeks. ROK has risen 5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 18.3%. However, shares of ROK are up 3.1% on a YTD basis, slightly outpacing SPX’s 2.4% gain.
Focusing more closely, the Milwaukee, Wisconsin-based company has lagged behind the Industrial Select Sector SPDR Fund’s (XLI) 12.2% return over the past 52 weeks and a 5.2% YTD gain.
Shares of Rockwell Automation climbed 12.7% on Feb. 10 due to better-than-expected Q1 fiscal 2025 results, with adjusted EPS of $1.83 beating the consensus estimate. Despite an 8% year-over-year revenue decline, total sales of $1.9 billion surpassed the consensus estimate. Investors were encouraged by the company's effective cost-reduction and margin expansion efforts, which helped offset lower sales volume and improve segment operating margins. Moreover, Rockwell maintained its organic sales growth guidance and projected adjusted EPS between $8.60 and $9.80 for fiscal 2025, reassuring stability.
For the fiscal year, ending in September 2025, analysts expect ROK’s EPS to decline 3.7% year-over-year to $9.35. However, the company's earnings surprise history is promising. It topped the consensus estimates in the last four quarters.
Among the 23 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on nine “Strong Buy” ratings, 11 “Holds,” and three “Strong Sells.”
This configuration is more bullish than three months ago, with seven “Strong Buy” ratings on the stock.
On Feb. 12, Morgan Stanley raised Rockwell Automation's price target to $345, maintaining an “Overweight” rating. The firm cited stronger Q1 margins and orders, supporting its view that the U.S. factory automation cycle is improving, driving positive earnings revisions and multiple expansions for ROK.
As of writing, ROK is trading below the mean price target of $308.62. The Street-high price target of $365 implies a potential upside of 23.8% from the current price levels.
