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Rotork plc
(LSE:ROR)
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Rating:76Outperform
Price Target:
550.00 p
▲(12.70% Upside)
Action:Upgraded
Date:08/04/26
The score is driven primarily by strong financial quality (low leverage, healthy margins/returns) and a constructive earnings update with unchanged guidance and strong ROCE/cash conversion. Offsetting factors are stretched technical conditions (very high RSI/Stoch) and a relatively expensive valuation (P/E ~35 with a modest yield).
Positive Factors
Balance sheet strength
Rotork's extremely low leverage provides durable financial flexibility to fund R&D, M&A and capex through cycles without stressing liquidity. Low debt reduces refinancing risk and supports consistent capital returns and investment in growth initiatives over the next several quarters.
Negative Factors
Order weakness and Oil & Gas exposure
Declining orders and marked Oil & Gas weakness expose cyclical demand risk in a material end market. If upstream/midstream activity remains soft, revenue and backlog growth could lag, pressuring utilisation and making sustained top-line momentum harder to achieve over upcoming quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Balance sheet strength
Rotork's extremely low leverage provides durable financial flexibility to fund R&D, M&A and capex through cycles without stressing liquidity. Low debt reduces refinancing risk and supports consistent capital returns and investment in growth initiatives over the next several quarters.
Read all positive factors
Rotork plc (ROR) vs. iShares MSCI United Kingdom ETF (EWC)
Market Cap
£3.96B
Dividend Yield1.71%
Average Volume (3M)1.23M
Price to Earnings (P/E)35.1
Beta (1Y)1.26
Revenue Growth3.03%
EPS Growth13.76%
CountryUK
Employees3,585
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.15
Shares Outstanding817,117,070
10 Day Avg. Volume1,135,746
30 Day Avg. Volume1,234,328
Financial Highlights & Ratios
PEG Ratio1.39
Price to Book (P/B)4.68
Price to Sales (P/S)3.50
P/FCF Ratio23.41
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
£484.00Price Target Upside-0.82% Downside
Rating ConsensusHold
Number of Analyst Covering9
EPS Forecast (FY)0.18
Revenue Forecast (FY)£785.55M
Rotork plc Business Overview & Revenue Model
Company Description
Rotork plc designs, manufactures, and distributes cutting-edge flow control and instrumentation solutions for diverse global industries. Their primary markets include the oil and gas sector, water and wastewater management, power generation, chemi...
How the Company Makes Money
Rotork primarily makes money by selling engineered flow-control equipment and related services to industrial customers and infrastructure operators. Key revenue streams include: (1) Product sales: Actuators (electric, pneumatic, and hydraulic), va...
Rotork plc Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Mar 02, 2027
Earnings Call Sentiment Positive
The call presents a predominantly positive performance: the business delivered organic revenue growth, margin expansion (60 bps OCC), strong CPI outperformance (+16% revenue and +170 bps margin), high ROCE (37%), robust cash generation (79% cash conversion and GBP 22m free cash flow) and significant shareholder returns (GBP 44m dividends + GBP 40m buybacks). These positives are tempered by an overall 4% decline in orders, an 8.4% drop in Oil & Gas sales and near-term costs related to ERP implementation (GBP 15m) and working capital volatility due to Middle East-related disruption. On balance, strategic progress, high margins and cash/return strength outweigh the sector-specific and timing headwinds.Positive Updates
Revenue and Earnings Growth
Group revenue GBP 367m (organic constant currency) representing 1.3% growth; adjusted operating profit GBP 82m, up 4.1%; adjusted operating margin 22.4% (headline improvement 40 basis points; 60 basis points OCC); adjusted EPS 7.4p, up 4.2%.
Negative Updates
Orders Decline and Revenue Headwinds
Orders received GBP 372m, down 4% year-on-year; reported revenue flat (impacted by prior disposals and modest FX headwind) despite 1.3% OCC growth.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Earnings Growth
Group revenue GBP 367m (organic constant currency) representing 1.3% growth; adjusted operating profit GBP 82m, up 4.1%; adjusted operating margin 22.4% (headline improvement 40 basis points; 60 basis points OCC); adjusted EPS 7.4p, up 4.2%.
Read all positive updates
Company Guidance
Guidance was unchanged: management expects further progress on an organic constant currency (OCC) basis in 2026 and reiterated its ambition to deliver mid‑ to high‑single‑digit revenue growth and adjusted operating margins in the mid‑20s over time (H1 adjusted operating margin was 22.4% and ROCE 37%). By business line, Oil & Gas is expected to see a gradual H2 recovery but full‑year revenues now flagged as slightly lower year‑on‑year, CPI is expected to be stronger for the full year after H1 revenue growth of c.16% (with critical HVAC doubling to ~6% of group revenues and data‑center activity notably strong), and Water & Power guidance is unchanged (H1 sales +3.4%, division margin 28.1%), while Rotork Service continues to grow (24% of group sales). Cash generation and capital allocation support the outlook: H1 cash conversion was 79%, free cash flow was GBP 22m, net cash ended GBP 25m, R&D was GBP 7.3m, the interim dividend is 3p (up 1.7%) and GBP 40m of buybacks were completed; finally, the recommended ABB cash offer of 506p per share (503p + 3p interim dividend) — ~19.5x EV/adjusted EBITDA and a 73% premium to the 15 July undisturbed share price — is expected to complete in H1 2027, with management focused on “business as usual” execution until then.Rotork plc Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
74
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 777.20M | 777.30M | 754.43M | 719.15M | 641.81M | 569.16M |
| Gross Profit | 385.50M | 382.70M | 371.93M | 339.10M | 291.73M | 262.77M |
| EBITDA | 204.90M | 206.20M | 163.21M | 169.94M | 148.67M | 133.48M |
| Net Income | 122.40M | 115.40M | 103.58M | 113.14M | 93.24M | 80.25M |
Balance Sheet | ||||||
| Total Assets | 766.20M | 813.80M | 780.49M | 773.78M | 735.73M | 676.15M |
| Cash, Cash Equivalents and Short-Term Investments | 70.00M | 110.00M | 149.98M | 146.37M | 114.77M | 123.47M |
| Total Debt | 44.70M | 44.70M | 24.65M | 11.96M | 8.84M | 9.34M |
| Total Liabilities | 206.50M | 229.40M | 181.98M | 151.49M | 145.83M | 142.07M |
| Stockholders Equity | 558.10M | 581.60M | 595.78M | 620.59M | 588.48M | 534.08M |
Cash Flow | ||||||
| Free Cash Flow | 109.70M | 116.20M | 128.83M | 113.09M | 46.55M | 65.27M |
| Operating Cash Flow | 117.40M | 125.60M | 148.77M | 124.89M | 59.45M | 85.42M |
| Investing Cash Flow | 8.80M | -44.90M | -12.95M | -23.46M | -6.84M | -12.24M |
| Financing Cash Flow | -131.80M | -118.70M | -129.47M | -64.85M | -62.39M | -136.61M |
Rotork plc Technical Analysis
Positive
488.00
Price Trends
354.41
Positive
333.89
Positive
337.36
Positive
Market Momentum
45.21
Negative
86.92
Negative
43.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:ROR, the sentiment is Positive. The current price of 488 is above the 20-day moving average (MA) of 427.85, above the 50-day MA of 354.41, and above the 200-day MA of 337.36, indicating a bullish trend. The MACD of 45.21 indicates Negative momentum. The RSI at 86.92 is Negative, neither overbought nor oversold. The STOCH value of 43.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:ROR.
Rotork plc Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | £3.96B | 35.05 | 20.10% | 1.70% | 3.03% | 13.76% | |
76 Outperform | £6.97B | 21.43 | 32.41% | 1.12% | 7.67% | 45.97% | |
71 Outperform | £1.30B | 32.74 | 33.12% | 4.37% | 24.42% | 103.25% | |
69 Neutral | £7.77B | 34.31 | 13.71% | 1.75% | -31.27% | -13.26% | |
65 Neutral | £6.80B | 25.84 | 13.45% | 1.59% | 5.84% | -14.62% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
60 Neutral | £5.12B | 31.43 | 13.86% | 2.40% | 2.26% | -14.63% |
* Industrials Sector Average
GB:ROR
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49.31%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.