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1. Company Snapshot

1.a. Company Description

Rotork plc designs, manufactures, and markets flow control and instrumentation solutions for the oil and gas, water and wastewater, power, chemical, process, and industrial markets.It operates through three segments: Oils & Gas; Water & Power; and Chemical, Process & Industrial segments.The company offers electric, fluid power, and process control actuators.


It also provides gearboxes and valve accessories comprising multi-turn and quarter-turn gearboxes, smart position indicators, direct mount chain wheels, valve accessories, roto hammers, and master gear products.In addition, the company offers instrumentation and control products, such as instrument valves, controllers, and measurement products; and pneumatic valves and manifolds, which include air preparation equipment, poppet valves, spool valves, ancillaries, direct acting solenoid valves, slide valves, and impact pneumatic manifolds.Further, it provides master station, foundation fieldbus, modbus, profibus, devicenet, HART, ethernet, and control network legacy products; and actuator workshop overhaul, field support, planned shutdown support, technical support, and training services.


The company operates in the United Kingdom, Italy, rest of Europe, the United States, rest of the Americas, China, and internationally.The company was incorporated in 1957 and is headquartered in Bath, the United Kingdom.

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1.b. Last Insights on ROR

Rotork plc's recent performance was bolstered by a robust earnings release, which showcased a 10% year-over-year increase in revenue. The company's order intake also surged, driven by a significant rise in demand for its industrial automation solutions. Furthermore, Rotork's estimated fair value stands at £4.07 per share, indicating a potential upside of 23% from its current price, according to a recent analysis. This valuation suggests that the company's shares may be undervalued, providing a compelling investment opportunity. Additionally, Rotork's strong cash flow generation has enabled the company to maintain a healthy balance sheet, with a significant amount of cash available for strategic initiatives.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Estimating The Fair Value Of Rotork plc (LON:ROR)

Oct -29

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What Is Rotork plc's (LON:ROR) Share Price Doing?

Sep -26

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3 UK Stocks That May Be Priced Below Their Intrinsic Value Estimates

Sep -10

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Are Strong Financial Prospects The Force That Is Driving The Momentum In Rotork plc's LON:ROR) Stock?

Aug -27

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Rotork's (LON:ROR) Dividend Will Be £0.0295

Aug -10

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Rotork plc (LON:ROR) Shares Could Be 23% Below Their Intrinsic Value Estimate

May -17

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At UK£2.87, Is Rotork plc (LON:ROR) Worth Looking At Closely?

Apr -14

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Rotork Full Year 2024 Earnings: EPS Misses Expectations

Mar -28

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.76%)

6. Segments

Oil and Gas

Expected Growth: 4.5%

Rotork plc's 4.5% growth in Oil and Gas is driven by increasing demand for automation and control systems in the sector, coupled with the company's strong presence in the Middle East and Asia. Additionally, the growing need for energy efficiency and reducing emissions is driving investment in Rotork's valve and actuator solutions.

Chemical, Process and Industrial

Expected Growth: 4.8%

Rotork plc's 4.8% growth in Chemical, Process and Industrial segments is driven by increasing demand for automation and control systems in the oil and gas industry, growth in the power generation sector, and rising adoption of IoT-enabled valves and actuators. Additionally, investments in digitalization and expansion into emerging markets contribute to the segment's growth.

Water and Power

Expected Growth: 5.2%

Rotork plc's Water and Power segment growth of 5.2% is driven by increasing demand for efficient water management systems, rising investments in renewable energy, and growing need for electrification in emerging markets. Additionally, the company's focus on innovation, strategic acquisitions, and expansion into new geographies have contributed to its growth momentum.

7. Detailed Products

Electric Actuators

Rotork's electric actuators are designed for precise control and reliability in industrial automation applications.

Pneumatic Actuators

Rotork's pneumatic actuators provide reliable and efficient control for industrial valves and dampers.

Hydraulic Actuators

Rotork's hydraulic actuators provide high-torque and high-speed control for industrial valves and dampers.

Gearboxes and Accessories

Rotork's gearboxes and accessories provide customized solutions for industrial automation applications.

Control Systems

Rotork's control systems provide advanced control and monitoring solutions for industrial automation applications.

Valve Pakcages

Rotork's valve packages provide pre-assembled and tested valve and actuator solutions for industrial automation applications.

8. Rotork plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Rotork plc's products are specialized and customized, making it difficult for substitutes to enter the market.

Bargaining Power Of Customers

Rotork plc's customers are diverse and fragmented, reducing their bargaining power.

Bargaining Power Of Suppliers

Rotork plc's suppliers have some bargaining power due to the specialized nature of their products, but the company's large scale of operations helps to mitigate this.

Threat Of New Entrants

The high barriers to entry in the industry, including significant capital requirements and technical expertise, make it difficult for new entrants to compete with Rotork plc.

Intensity Of Rivalry

The industry is highly competitive, with several established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 1.89%
Debt Cost 8.88%
Equity Weight 98.11%
Equity Cost 8.88%
WACC 8.88%
Leverage 1.93%

11. Quality Control: Rotork plc passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Smiths

A-Score: 6.0/10

Value: 2.7

Growth: 5.1

Quality: 6.7

Yield: 3.1

Momentum: 9.0

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
GEA

A-Score: 6.0/10

Value: 2.7

Growth: 5.1

Quality: 6.6

Yield: 3.8

Momentum: 9.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Valmet

A-Score: 5.7/10

Value: 5.1

Growth: 4.8

Quality: 5.1

Yield: 7.5

Momentum: 6.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Wärtsilä

A-Score: 5.5/10

Value: 2.9

Growth: 6.3

Quality: 7.6

Yield: 3.8

Momentum: 7.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Rotork

A-Score: 5.5/10

Value: 2.0

Growth: 4.4

Quality: 8.0

Yield: 3.8

Momentum: 6.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Georg Fischer

A-Score: 5.3/10

Value: 3.3

Growth: 3.9

Quality: 4.8

Yield: 6.9

Momentum: 5.5

Volatility: 7.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

3.41$

Current Price

3.41$

Potential

-0.00%

Expected Cash-Flows