Rockwell Automation Rocking (Well)

Rockwell Automation, Inc. (ROK - Analyst Report) is a leading industrial automation company, providing power, control and information solutions to improve manufacturing capacity. The company reported second quarter EPS of $0.96, up 17.1% from the prior-year quarter, amid strong productivity performance, higher sales volume, and pricing gains.

Acquisitions are now providing more top-line boost, but at the cost of mitigating operating leverage. Management is confident that recent growth investments and international diversification will deliver FY08 revenue up 10-12%, with international sales expected to deliver mid-teens organic growth and North America accelerating modestly to mid-single-digits.

We reiterate our Buy rating on shares of ROK with a target price of $63.00 per share. The shares of Rockwell are currently trading at 12.9x our FY08 EPS estimate of $4.34, at a discount to the industry median multiple and its peer group. The company has a leadership position in the industrial automation space. Over the past several quarters, the company's financial performance has benefited from a number of items, including a falling U.S. dollar, strong productivity, and higher volume.

Read the full analyst report on ROK.