Education
About Us
Working with TipRanks
Follow Us
Rockwell Automation (ROK)
NYSE:ROK
Top Page
Rockwell Automation
(NYSE:ROK)
Select Model
Select Model
Rating:68Neutral
Price Target:
$430.00
â–²(10.93% Upside)
Action:ReiteratedDate:02/18/26
The score is driven primarily by solid fundamentals (profitability and cash generation) and a constructive earnings outlook with margin expansion and raised EPS guidance. These strengths are tempered by weak near-term technical momentum and a demanding valuation (high P/E with a modest yield).
Positive Factors
Profitability & Cash Generation
Rockwell reports mid-teens net margins and strong operating and free cash flow, indicating durable earnings power and internal funding for R&D, capex, and shareholder returns. Sustained cash generation supports strategic investments and buybacks, providing flexibility through business cycles.
Software & Recurring Revenue Momentum
Software and recurring revenue growth (ARR +7%) reflects a structural shift to higher-margin, sticky revenue streams. Increasing subscription and software adoption enhances revenue visibility, improves lifetime customer value, and supports margin resilience as hardware cycles fluctuate.
Margin Expansion & Productivity Actions
The company delivered ~360bps of segment margin expansion driven by volume, mix, productivity and structural cost actions; simultaneous AI adoption and process improvements should sustain better incremental margins over time, improving returns on incremental sales.
Negative Factors
Elevated Leverage
Debt near 0.9x equity reduces financial flexibility versus more conservatively financed peers, limiting capacity for large strategic M&A or prolonged buybacks during downturns. Interest costs and covenant sensitivity can constrain capital allocation if macro stress increases.
Modest Top-Line Growth
Trailing revenue growth is only modest, reflecting limited top-line acceleration. Structural growth dependence on industrial capex cycles and selective vertical strength means revenue gains can be uneven, making sustained organic expansion and market-share gains a multi-quarter challenge.
Cash-Flow Momentum & Working Capital Risk
YoY FCF decline and a large Q1 working-capital drag highlight volatility in cash conversion. Persistent working-capital swings or incentive-related payouts could pressure free cash flow, reducing reinvestment capacity and complicating delivery on repurchase and payout targets in weaker demand periods.
Rockwell Automation (ROK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$44.55B
Dividend Yield1.33%
Average Volume (3M)983.67K
Price to Earnings (P/E)45.4
Beta (1Y)0.99
Revenue Growth0.98%
EPS Growth-7.51%
CountryUS
Employees27,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)2.75
Shares Outstanding112,357,910
10 Day Avg. Volume1,251,559
30 Day Avg. Volume983,673
Financial Highlights & Ratios
PEG Ratio-5.99
Price to Book (P/B)10.78
Price to Sales (P/S)4.72
P/FCF Ratio29.01
Enterprise Value/Market Cap1.10
Enterprise Value/Revenue5.74
Enterprise Value/Gross Profit11.43
Enterprise Value/Ebitda32.40
Forecast
1Y Price Target
$410.93Price Target Upside6.01% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)12.11
Revenue Forecast (FY)$8.86B
Rockwell Automation Business Overview & Revenue Model
Company DescriptionRockwell 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.
How the Company Makes MoneyRockwell Automation generates revenue through several key streams, primarily from the sale of automation equipment, software, and services. Their main revenue sources include: 1) Product Sales: This includes hardware such as controllers, sensors, and drives that are essential for automation processes. 2) Software Solutions: Rockwell offers a range of software products that assist in manufacturing operations, including data analytics and visualization tools. 3) Services: The company provides consulting, training, and maintenance services to help clients optimize their automation systems. 4) Subscription Services: Increasingly, Rockwell is moving towards subscription-based models for software, providing ongoing updates and support. Significant partnerships with technology firms and industry leaders enhance their product offerings and market reach, contributing to their overall earnings. Additionally, their investments in emerging technologies like IoT and AI are expected to drive future revenue growth.
Rockwell Automation Key Performance Indicators (KPIs)
Any
Operating Earnings by Segment
Shows earnings from different business segments, providing insight into which areas are most profitable and how effectively resources are allocated.
Shows earnings from different business segments, providing insight into which areas are most profitable and how effectively resources are allocated.
Data provided by:
The Fly
The FlyRockwell Automation Earnings Call Summary
Earnings Call Date:Feb 05, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive operating and financial performance: strong top-line growth (reported sales +12%), robust software and product momentum (ARR +7%, Intelligent Devices +16% organic, Software & Control +17% organic, Logix NA +25%+), meaningful margin expansion (total segment margin expanded 360 bps; Q1 incrementals ~50%), and an EPS beat ($2.75). Management nonetheless emphasized caution about macro uncertainties—trade/tariff volatility, delayed large CapEx projects, a softer Lifecycle Services revenue line (-6% organic), and a Q1 free cash flow decline—keeping the company prudent on full-year upside. Overall, the positive operational execution, margin gains, and customer wins materially outweigh the headwinds and uncertainty noted, supporting a Positive sentiment.Q1-2026 Updates
Positive Updates
Strong Top-Line Growth
Reported Q1 sales up 12% year-over-year; double-digit year-over-year growth in both reported and organic sales. Currency contributed ~2 points and price contributed ~3 points to sales growth.
Adjusted EPS and Margin Outperformance
Q1 adjusted EPS of $2.75 exceeded expectations. Total company segment margin expanded to 20.7%, with 360 basis points of segment margin expansion year-over-year driven by volume, favorable mix, and productivity.
Segment Margin and Flow-Through Strength
Q1 incrementals ~50% company-wide. Intelligent Devices margin improved to 17.3% (+240 bps YoY), Software & Control margin to 31.2% (+610 bps YoY), and Lifecycle Services margin to 14.1% (+160 bps YoY).
Software & Recurring Revenue Momentum
Annual recurring revenue grew 7% in the quarter. Software & Control organic sales grew 17% YoY, with strong Logix momentum (North American Logix sales +25%+ YoY) and the Plex cloud-native platform delivering its strongest quarter to date.
Product Business Strength — Intelligent Devices
Intelligent Devices organic sales were up 16% YoY with broad-based growth, particularly in drives and motion. Strong wins included high-speed packaging and autonomous material handling (AMRs / independent cart technology).
Key Customer Wins and Use Cases
Notable customer wins: RH Shepherd (Plex), Hindalco (OT cybersecurity across six plants), Thermo Fisher (AI-enabled troubleshooting agent), PFM Group and Comma (advanced motion for packaging), ATS (auto AMRs), FS Bioenergia (greenfield automation with carbon capture), Cortiva Agriscience (process modernization).
Operational Productivity and AI Adoption
Company advanced structural productivity actions across projects, commercial spend, direct material, and supply chain; broad adoption of AI internally and in customer solutions (e.g., FactoryTalk Design Studio Copilot, Emulate 3D, Logix.AI) cited as margin and differentiation drivers.
Prudent But Raised Fiscal EPS Outlook
Full-year organic sales growth guide maintained at 2%–6%. Adjusted EPS midpoint increased to $11.80 (lower end raised to $11.40) due to discrete tax benefits realized in Q1. Free cash flow conversion still targeted at ~100% for FY26.
Balance Sheet / Capital Allocation Actions
Purchased Mequon, WI facility (~$60M, finance lease) and targeting ~$500M of share repurchases in the year. Sensia dissolution expected April 1 with no significant adjusted EPS impact, ~ $250M annualized sales reduction and ~50 bps annualized margin improvement.
Negative Updates
Lifecycle Services Revenue Decline
Lifecycle Services organic sales declined 6% year-over-year, reflecting project delays and customers delaying or narrowing larger projects due to trade policy uncertainty. Book-to-bill for the segment was 1.16.
Free Cash Flow and Working Capital Drag in Q1
Q1 free cash flow of $170M was down $123M versus prior year, primarily due to working capital changes and incentive compensation payments (no incentive payouts in prior-year quarter).
Tariff-Related Cost Pressure
Tariffs had a neutral impact on total Q1 earnings but were a headwind of ~30 basis points on segment margins year-over-year. Company expects two points of total price in FY26 with one point tariff-based; tariff-based pricing dampens incremental margins.
Macro and CapEx Uncertainty
Management flagged ongoing geopolitical uncertainty, trade volatility, and supply chain risk that continue to suppress some capital spending; many customers still holding large CapEx investments on pause, limiting upside to the top-end of the guide.
Life Sciences & Some Sector Delays
Life sciences sales declined low single digits YoY in Q1 due to several project delays in North America, though management expects full-year growth in the sector.
Semiconductor Weakness Versus Tough Comp
Semiconductor-related sales were down in Q1 (tough comparable quarter a year ago). Management noted a volatile environment in semiconductors with CapEx concentrated among AI-related players.
Q2 Tax Rate Headwind
Discrete tax benefits lowered Q1 effective tax rate to ~17% (helped EPS by ~$0.09), but management now expects a full-year effective tax rate around ~19.5% and a Q2 rate of ~20%, representing a sequential ~$0.10 EPS headwind for Q2.
Sensia Dissolution Accounting Items
Sensia dissolution items are on the balance sheet as held-for-sale and produce non-operating GAAP adjustments (tax gain capture) that are removed from adjusted EPS; Sensia-related transition and classification add complexity to the balance sheet and reporting near-term.
Company Guidance
Rockwell’s fiscal‑2026 guidance calls for organic sales growth of 2%–6% (midpoint assumes gradual sequential improvement), recurring revenue up high single‑digits, and total company segment margin expansion of >100 bps; adjusted EPS guidance was nudged up (lower end to $11.40, midpoint $11.80), with free cash‑flow conversion ~100% and CapEx targeted at ~3% of sales. Management expects total price of ~2 points (1 pt underlying, 1 pt tariff), full‑year incremental margins of ~40% (inclusive of tariff pricing), an anticipated full‑year effective tax rate of ~19.5% (Q1 was ~17%, which contributed ~$0.09 to EPS and creates an expected ~$0.10 sequential tax headwind into Q2), and Sensia dissolution is excluded from the guide (anticipated annualized sales reduction ≈ $250M and ≈50 bps improvement to segment margin). Corporate & other expense is expected ≈ $105M, net interest ≈ $115M, average diluted shares ≈ 112.7M, and the company is targeting ≈ $500M of repurchases; near‑term Q2 expectations are slightly up sequential sales (mid‑single‑digit YoY), modest sequential margin improvement (tens of bps; <100 bps YoY), and Q2 adjusted EPS roughly ~$2.85 (low single‑digit sequential growth).Rockwell Automation Financial Statement Overview
Summary
Solid profitability and cash generation (mid-teens net margin; strong operating cash flow and free cash flow), supported by strong shareholder returns (ROE ~27.7%). Offsets include meaningful leverage (~0.9x debt-to-equity), only modest recent revenue growth (+2.7% TTM), and softer recent cash-flow momentum (FCF down ~9% YoY).Income Statement
TTM (Trailing-Twelve-Months) revenue is up modestly (+2.7%), showing resilience but not strong acceleration. Profitability is solid, with a mid-teens net margin (15.3%) and healthy operating profitability, though margins have been volatile across recent annual periods (notably stronger in 2023, weaker in 2024/2025 annual). Overall, the income statement reflects good earnings power, but the growth profile is currently moderate and margin consistency is a watch item.78
Positive
Balance Sheet
Leverage is meaningful: TTM debt is about 0.9x equity (and roughly ~1.0x in the latest annual), which is manageable but reduces flexibility versus a more conservatively financed peer. Returns to shareholders are strong (TTM return on equity ~27.7%), indicating efficient capital use, but the combination of elevated leverage and only moderate equity cushion keeps balance-sheet risk from scoring higher.64
Positive
Cash Flow
Cash generation is strong in absolute terms (TTM operating cash flow ~$1.4B and free cash flow ~$1.24B). Free cash flow tracks earnings reasonably well (about 87% of net income in TTM), supporting quality of profits, but TTM free cash flow is down year over year (-9.1%). Cash flow coverage is improved versus prior annual periods, yet overall cash flow momentum is slightly negative in the most recent TTM window.72
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 8.57B | 8.34B | 8.26B | 9.06B | 7.76B | 7.00B |
| Gross Profit | 4.30B | 4.02B | 3.68B | 3.72B | 3.10B | 2.90B |
| EBITDA | 1.52B | 1.40B | 1.57B | 1.99B | 1.44B | 1.33B |
| Net Income | 990.00M | 869.00M | 952.50M | 1.39B | 932.20M | 1.36B |
Balance Sheet | ||||||
| Total Assets | 11.23B | 11.22B | 11.23B | 11.30B | 10.76B | 10.70B |
| Cash, Cash Equivalents and Short-Term Investments | 444.00M | 468.00M | 471.00M | 1.07B | 511.90M | 662.20M |
| Total Debt | 4.06B | 3.65B | 4.08B | 3.33B | 4.18B | 4.38B |
| Total Liabilities | 7.43B | 7.51B | 7.56B | 7.56B | 7.74B | 8.01B |
| Stockholders Equity | 3.75B | 3.65B | 3.50B | 3.56B | 2.73B | 2.39B |
Cash Flow | ||||||
| Free Cash Flow | 1.24B | 1.36B | 639.10M | 1.21B | 682.00M | 1.14B |
| Operating Cash Flow | 1.41B | 1.54B | 863.80M | 1.37B | 823.10M | 1.26B |
| Investing Cash Flow | -202.00M | -216.00M | -982.50M | 854.30M | -7.80M | -2.63B |
| Financing Cash Flow | -1.23B | -1.33B | -502.80M | -1.68B | -934.20M | 1.30B |
Rockwell Automation Technical Analysis
Neutral
387.63
Price Trends
405.88
Negative
386.09
Positive
358.40
Positive
Market Momentum
-5.10
Positive
41.27
Neutral
35.10
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ROK, the sentiment is Neutral. The current price of 387.63 is below the 20-day moving average (MA) of 408.03, below the 50-day MA of 405.88, and above the 200-day MA of 358.40, indicating a neutral trend. The MACD of -5.10 indicates Positive momentum. The RSI at 41.27 is Neutral, neither overbought nor oversold. The STOCH value of 35.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ROK.
Rockwell Automation Risk Analysis
Rockwell Automation disclosed 20 risk factors in its most recent earnings report. Rockwell Automation reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rockwell Automation Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $125.90B | 36.38 | 25.79% | 0.79% | 0.22% | 26.66% | |
72 Outperform | $85.35B | 28.23 | 93.75% | 2.43% | -0.41% | -10.88% | |
70 Outperform | $38.07B | 67.04 | 5.35% | 0.10% | 4.20% | -34.47% | |
68 Neutral | $44.55B | 45.36 | 27.71% | 1.33% | 0.98% | -7.51% | |
67 Neutral | $81.93B | 28.93 | 25.14% | 1.48% | -1.78% | 27.35% | |
64 Neutral | $3.04B | 21.16 | 13.54% | 1.42% | 9.30% | -12.55% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
ROK
Rockwell Automation
387.63
103.24
36.30%
CXT
Crane NXT
51.22
-5.73
-10.06%
CMI
Cummins
587.36
232.90
65.71%
ITW
Illinois Tool Works
293.22
33.50
12.90%
PH
Parker Hannifin
1,008.97
357.82
54.95%
IR
Ingersoll Rand
93.94
10.63
12.76%
Rockwell Automation Corporate Events
Business Operations and StrategyRegulatory Filings and ComplianceShareholder Meetings
Rockwell Automation Shareowners Approve 2026 Long-Term Incentive Plan
Positive
Feb 17, 2026
On February 10, 2026, Rockwell Automation shareowners approved the company’s 2026 Long-Term Incentives Plan at their annual meeting, authorizing 10.6 million shares of common stock for a broad range of equity awards to employees and directors. The plan, which replaces and recycles certain shares from prior long-term incentive programs, is designed to support Rockwell Automation’s ability to grant stock options, restricted stock, performance-based awards, and other equity instruments, aligning compensation with performance and regulatory requirements of the New York Stock Exchange and federal tax rules.
The 2026 plan allows non-qualified and incentive stock options for employees, stock appreciation rights, restricted stock units, performance shares and units, and unrestricted stock for directors, providing the company with flexible tools to attract, retain, and motivate key talent. By securing shareowner approval and complying with exchange and tax regulations, Rockwell Automation reinforces its long-term incentive framework, which may influence its capital structure and strengthen alignment between management, directors, and shareowners over time.
The most recent analyst rating on (ROK) stock is a Hold with a $407.00 price target. To see the full list of analyst forecasts on Rockwell Automation stock, see the ROK Stock Forecast page.
Executive/Board ChangesShareholder Meetings
Rockwell Automation Shareholders Approve Directors and Incentive Plan
Positive
Feb 13, 2026
At Rockwell Automation’s annual shareholders meeting held on February 10, 2026, investors elected three directors—William P. Gipson, Pam Murphy, and Robert W. Soderbery—to terms expiring at the 2029 annual meeting, reinforcing continuity on the board. Shareholders also expressed strong support for management by approving, on an advisory basis, the compensation of the company’s named executive officers with approximately 87% of votes cast in favor.
In addition, shareholders ratified Deloitte & Touche LLP as Rockwell Automation’s independent registered public accounting firm for fiscal 2026, signaling confidence in the company’s financial oversight. Investors further backed the Rockwell Automation, Inc. 2026 Long-Term Incentives Plan, endorsing the company’s approach to long-term executive and employee incentives aimed at aligning compensation with performance and shareholder interests.
The most recent analyst rating on (ROK) stock is a Hold with a $400.00 price target. To see the full list of analyst forecasts on Rockwell Automation stock, see the ROK Stock Forecast page.
Private Placements and Financing
Rockwell Automation Secures New $1.5 Billion Credit Deal
Neutral
Nov 21, 2025
On November 18, 2025, Rockwell Automation entered into a new $1.5 billion five-year unsecured revolving credit agreement with Bank of America as the administrative agent, replacing an earlier agreement from June 2022. This agreement allows for an increase in commitments by up to $750 million and includes options to extend the maturity date, with borrowings intended for general corporate purposes. The new agreement maintains similar covenants and conditions as the previous one, with no early termination penalties incurred, and it does not restrict the company’s ability to pay dividends.
The most recent analyst rating on (ROK) stock is a Buy with a $402.00 price target. To see the full list of analyst forecasts on Rockwell Automation stock, see the ROK Stock Forecast page.
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.