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1. Company Snapshot

1.a. Company Description

Rockwell Automation, Inc.provides industrial automation and digital transformation solutions in the United States and internationally.The company operates in three segments, Intelligent Devices, Software & Control, and Lifecycle Services.


Its solutions include hardware and software products, and services.The Intelligent Devices segment offers drives, motion, safety, sensing, industrial components, and configured-to-order products.The Software & Control segment provides control and visualization software and hardware, information software, digital twin and simulation software, and network and security infrastructure solutions.


The Lifecycle Services segment provides consulting, professional services and solutions, and connected and maintenance services.The company sells its solutions primarily through independent distributors in relation with its direct sales force.It serves discrete end markets, including automotive, semiconductor, warehousing and logistics, and other discrete markets, as well as general industries comprising printing and publishing, marine, glass, fiber and textiles, airports, and aerospace; hybrid end markets, such as food and beverage, life sciences, household and personal care, and tire, as well as eco industrial, including water/wastewater, waste management, mass transit, and renewable energy; and process end markets comprising oil and gas, mining, metals, chemicals, pulp and paper, and others.


Rockwell Automation, Inc.was founded in 1903 and is headquartered in Milwaukee, Wisconsin.

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1.b. Last Insights on ROK

Rockwell Automation's recent performance was driven by strong Q1 2026 earnings, with a 12% year-over-year sales growth, beating estimates with quarterly earnings of $2.75 per share. Organic sales growth was double-digit, with a 10% increase. The company's growth attributes and solid financials have earned it a Zacks Rank #2 (Buy) upgrade. Despite some investors reducing their stakes, such as Principal Financial Group Inc. and Machina Capital S.A.S., the company's strong sales growth and margin expansion have been key drivers.

1.c. Company Highlights

2. Rockwell Automation's Q1 FY2026 Earnings: Strong Growth and Margin Expansion

Rockwell Automation, Inc. reported a strong first quarter fiscal 2026 earnings release, with double-digit year-over-year growth in both reported and organic sales. The company's Q1 sales growth was driven by Intelligent Devices, which delivered organic sales up 16% year-over-year, and Software and Control, which grew 17% versus the prior year. Adjusted EPS was $2.75, exceeding expectations, driven by higher volume, favorable mix, and strong productivity. The company's segment margin was 20.7%, and free cash flow conversion is still expected to be approximately 100%. Annual recurring revenue grew 7% in the quarter, in line with expectations.

Publication Date: Feb -08

📋 Highlights
  • Strong Segment Growth:: Intelligent Devices (+16% organic sales) and Software and Control (+17% organic sales) drove double-digit growth in Q1.
  • Exceeded Adjusted EPS:: Earnings of $2.75 surpassed expectations, fueled by higher volume, favorable mix, and productivity gains.
  • Revised Guidance:: Adjusted EPS midpoint raised to $11.80, reflecting better-than-expected discrete tax benefits in Q1.
  • Margin and Cash Flow:: Segment margin reached 20.7%, with free cash flow conversion expected at ~100% for the year.
  • Tariff Impact:: Tariffs neutralized Q1 earnings but reduced segment margins by 30 bps year-over-year.

Segment Performance

The company's segments performed well, with Intelligent Devices and Software and Control driving growth. The Logix business is benefiting from strong demand, new product introductions, and applications in areas like data centers. The company expects Logix units to return to pre-pandemic levels for the full year and continued benefits in food and beverage, life sciences, and home and personal care. Christian Rothe noted that tariffs had a neutral impact on Q1 earnings but were a drag of about 30 basis points on segment margins year-over-year.

Guidance and Outlook

The company is maintaining its organic sales growth outlook of 2% to 6% for fiscal 2026. The midpoint of the adjusted EPS guidance was increased to $11.80, reflecting discrete tax benefits that came in better than expected in Q1. The company expects mid-single-digit sales growth in the second quarter with margin expansion of less than 100 basis points. Rockwell Automation, Inc.'s net income for fiscal 2026 is expected to be about $105 million, with net interest expense of approximately $115 million.

Valuation and Metrics

With a P/E Ratio of 47.25 and an EV/EBITDA of 33.06, the market is pricing in significant growth expectations. The company's ROIC is 15.11%, and ROE is 27.69%, indicating strong profitability. The Net Debt / EBITDA ratio is 2.32, which is manageable. Analysts estimate next year's revenue growth at 5.9%, which is slightly higher than the company's current guidance.

Market Trends and Applications

The company is seeing positive momentum in various areas, including discussions on CapEx plans, but hasn't seen a broad-based release of orders. Inventory levels are back to normal at distribution and machine builders, with distributors optimistic but taking a prudent approach. The company is applying AI in various applications to provide specific productivity and efficiency improvements for customers and is seeing benefits in its own operations and in customer implementations.

3. NewsRoom

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Axxcess Wealth Management LLC Boosts Stock Holdings in Rockwell Automation, Inc. $ROK

Feb -21

Source: defenseworld.net

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Rockwell Automation, Inc. $ROK Shares Sold by Broderick Brian C

Feb -20

Source: defenseworld.net

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Midway Through The Robotics Earnings Season: Discipline Rewarded, Recovery Broadening

Feb -19

Source: seekingalpha.com

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Rockwell Automation, Inc. (ROK) Presents at Barclays 43rd Annual Industrial Select Conference Transcript

Feb -18

Source: seekingalpha.com

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Rockwell Automation, Inc. (ROK) Presents at Citi's Global Industrial Tech & Mobility Conference 2026 Transcript

Feb -17

Source: seekingalpha.com

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Rockwell Automation Cuts Maintenance Costs, Finds Savings for Canadian Supplier, Perth County Ingredients, with Fiix CMMS

Feb -17

Source: prnewswire.com

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Rockwell Automation Digital Twin Technology Accelerates Project Delivery and Cuts Costs for Brazil-based Falcare Industrial Equipment

Feb -16

Source: prnewswire.com

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Cibc World Market Inc. Has $7.24 Million Stock Position in Rockwell Automation, Inc. $ROK

Feb -14

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.79%)

6. Segments

Intelligent Devices

Expected Growth: 10.3%

Rockwell Automation’s Intelligent Devices segment is expected to grow driven by increasing adoption of IoT and Industry 4.0, rising demand for industrial automation and control systems, and growing need for real-time data analytics and insights.

Lifecycle Services

Expected Growth: 7.3%

Rockwell Automation's Lifecycle Services growth is driven by increasing adoption of Industry 4.0, rising need for operational efficiency, and growing demand for remote monitoring and predictive maintenance.

Software & Control

Expected Growth: 11.5%

Rockwell Automation's industrial automation and software solutions drive growth, fueled by Industry 4.0 and IoT adoption, increasing demand for smart manufacturing and process optimization.

7. Detailed Products

Control and Visualization Software

FactoryTalk software suite for control, visualization, and MES solutions

Programmable Logic Controllers (PLCs)

Allen-Bradley PLCs for discrete and process control applications

Human-Machine Interfaces (HMIs)

FactoryTalk View ME and SE software for HMI applications

Industrial Control and I/O Systems

Allen-Bradley ControlLogix and CompactLogix control systems

Safety and Security Solutions

TÜV-certified safety controllers and software for functional safety

Industrial Data Analytics and AI

FactoryTalk InnovationSuite for industrial data analytics and AI

Industrial Networking and Security

Stratix switches and network security solutions for industrial networks

Power Distribution and Control

Industrial power distribution and control solutions, including circuit breakers and motor control

Industrial Robots and Machine Safety

Integrated control and safety solutions for industrial robots and machinery

8. Rockwell Automation, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Rockwell Automation, Inc. operates in the industrial automation and control systems industry, where substitutes may exist in the form of alternative automation solutions or manual processes. However, the company's comprehensive product portfolio and strong brand reputation make it a preferred choice for many customers, reducing the threat of substitutes.

Bargaining Power Of Customers

Rockwell Automation's customers are primarily large industrial and manufacturing companies that require specialized automation solutions. These customers often have limited bargaining power due to the company's expertise and the high cost of switching to alternative solutions.

Bargaining Power Of Suppliers

Rockwell Automation sources components and materials from various suppliers. While some suppliers may have significant bargaining power due to their market position or unique products, the company's large volume purchases and long-term relationships with suppliers help to mitigate this risk.

Threat Of New Entrants

The industrial automation and control systems industry has significant barriers to entry, including high R&D costs, complex product development, and stringent regulatory requirements. This limits the threat of new entrants and provides a relatively stable competitive environment for Rockwell Automation.

Intensity Of Rivalry

The industrial automation and control systems industry is highly competitive, with several established players competing for market share. Rockwell Automation faces intense rivalry from companies like Siemens, ABB, and Schneider Electric, which can lead to pricing pressure and reduced profit margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.91%
Debt Cost 4.33%
Equity Weight 46.09%
Equity Cost 10.63%
WACC 7.23%
Leverage 116.96%

11. Quality Control: Rockwell Automation, Inc. passed 5 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

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Xylem

A-Score: 5.6/10

Value: 2.3

Growth: 5.6

Quality: 6.7

Yield: 2.0

Momentum: 7.5

Volatility: 9.3

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AMETEK

A-Score: 5.3/10

Value: 1.8

Growth: 5.8

Quality: 7.7

Yield: 1.0

Momentum: 6.0

Volatility: 9.3

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Rockwell Automation

A-Score: 5.2/10

Value: 0.9

Growth: 4.8

Quality: 6.6

Yield: 3.0

Momentum: 8.5

Volatility: 7.7

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Howmet Aerospace

A-Score: 5.1/10

Value: 0.0

Growth: 6.8

Quality: 6.7

Yield: 0.0

Momentum: 9.5

Volatility: 7.7

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Roper Technologies

A-Score: 5.0/10

Value: 3.0

Growth: 5.6

Quality: 7.4

Yield: 1.0

Momentum: 3.0

Volatility: 10.0

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Ingersoll Rand

A-Score: 4.2/10

Value: 2.1

Growth: 7.4

Quality: 6.0

Yield: 0.0

Momentum: 2.5

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

398.79$

Current Price

398.79$

Potential

-0.00%

Expected Cash-Flows