We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Rockwell Automation (ROK) Up 0.5% Since Last Earnings Report: Can It Continue?
Read MoreHide Full Article
A month has gone by since the last earnings report for Rockwell Automation (ROK - Free Report) . Shares have added about 0.5% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Rockwell Automation due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
Rockwell Automation has delivered adjusted earnings of $3.30 per share in the second quarter of fiscal 2026, up 32% from the year-ago quarter’s $2.50. The figure beat the Zacks Consensus Estimate of $2.89.
Quarterly revenues rose 11.9% year over year to $2.24 billion and topped the consensus mark of $2.11 billion by 6.3%. Results have reflected solid execution as organic sales increased 9%. Our model predicted organic growth to rise 5.3% in the quarter.
Rockwell Automation's Growth Broadens With Organic Gains & FX Tailwinds
Rockwell Automation’s fiscal second quarter featured a healthier demand backdrop across more end markets. Currency translation increased 3% year over year, surpassing our prediction of 0.7% growth.
The company also highlighted momentum in recurring revenues. Total Annual Recurring Revenue (ARR) increased 6% year over year, with software ARR up in the high-single digits, reinforcing the shift toward more durable revenue streams.
Segmental performance was led by the two higher-margin platforms. Intelligent Devices posted sales of $1 billion compared with $0.9 billion a year ago, whereas Software & Control increased to $684 million from $568 million.
The Intelligent Devices segment posted operating earnings of $211 million in the fiscal second quarter, which marked a year-over-year increase of 32.7%, while Software & Control’s operating earnings improved 39.8% to $239 million.
Lifecycle Services was comparatively steady, with sales of $547 million compared with $537 million in the prior-year quarter. The segment posted operating earnings of $80 million compared with $78 million in the prior-year quarter. However, the segment continues to report negative organic sales growth.
The cost of sales increased 8.3% year over year to $1.11 billion. The gross profit grew 15.8% to $1.12 billion. Selling, general and administrative expenses moved up 1.9% to $478 million.
Profitability improved sharply as Rockwell Automation converted higher volumes into stronger margins. The enterprise operating margin increased 350 basis points year over year to 22.5% in the quarter, alongside a pretax margin of 19.7%.
At the segment level, Intelligent Devices delivered a 20.9% operating margin, up 320 basis points year over year, and Software & Control reached 34.9%, up 480 basis points. Lifecycle Services was essentially flat year over year at 14.6%.
Rockwell Automation’s Cash Position & Balance Sheet Updates
Cash generation strengthened alongside earnings. Cash provided by operating activities was $320 million in the quarter compared with $199 million in the year-ago period.
The free cash flow improved to $275 million from $171 million. Rockwell Automation’s adjusted income was $373 million and free cash flow conversion was 74% for the quarter.
Cash and cash equivalents were $423 million at the quarter end, down from $468 million at the end of fiscal 2025.
Long-term debt stood at $2.57 billion, modestly below $2.61 billion at the end of fiscal 2025. The balance sheet positioning gives Rockwell Automation flexibility as it navigates portfolio actions, including the Sensia dissolution-related impacts discussed in its materials.
Raises FY26 Earnings View
The company lifted its full-year outlook following the strong quarter. ROK raised both its reported and organic sales growth view to 5-9% year over year and expects an Enterprise operating margin of 21.5%, up from the prior mentioned 20%.
Rockwell Automation also increased its adjusted earnings guidance to $12.50-$13.10 per share from $11.40-$12.20. The updated view reflects broadening demand and execution, while the company noted the guidance does not include sales, earnings or cash flows related to the divested Sensia joint venture businesses in the second half of fiscal 2026.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 7.47% due to these changes.
VGM Scores
At this time, Rockwell Automation has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Rockwell Automation has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Rockwell Automation belongs to the Zacks Electronics - Miscellaneous Products industry. Another stock from the same industry, Teradyne (TER - Free Report) , has gained 7.1% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Teradyne reported revenues of $1.28 billion in the last reported quarter, representing a year-over-year change of +87%. EPS of $2.56 for the same period compares with $0.75 a year ago.
Teradyne is expected to post earnings of $1.99 per share for the current quarter, representing a year-over-year change of +249.1%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Teradyne. Also, the stock has a VGM Score of F.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Rockwell Automation (ROK) Up 0.5% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Rockwell Automation (ROK - Free Report) . Shares have added about 0.5% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Rockwell Automation due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
Rockwwell Automation Beats Q2 Earnings Estimates on Higher Volume, Hikes FY26 View
Rockwell Automation has delivered adjusted earnings of $3.30 per share in the second quarter of fiscal 2026, up 32% from the year-ago quarter’s $2.50. The figure beat the Zacks Consensus Estimate of $2.89.
Quarterly revenues rose 11.9% year over year to $2.24 billion and topped the consensus mark of $2.11 billion by 6.3%. Results have reflected solid execution as organic sales increased 9%. Our model predicted organic growth to rise 5.3% in the quarter.
Rockwell Automation's Growth Broadens With Organic Gains & FX Tailwinds
Rockwell Automation’s fiscal second quarter featured a healthier demand backdrop across more end markets. Currency translation increased 3% year over year, surpassing our prediction of 0.7% growth.
The company also highlighted momentum in recurring revenues. Total Annual Recurring Revenue (ARR) increased 6% year over year, with software ARR up in the high-single digits, reinforcing the shift toward more durable revenue streams.
Rockwell Automation’s Segment Mix Supports Profit Expansion
Segmental performance was led by the two higher-margin platforms. Intelligent Devices posted sales of $1 billion compared with $0.9 billion a year ago, whereas Software & Control increased to $684 million from $568 million.
The Intelligent Devices segment posted operating earnings of $211 million in the fiscal second quarter, which marked a year-over-year increase of 32.7%, while Software & Control’s operating earnings improved 39.8% to $239 million.
Lifecycle Services was comparatively steady, with sales of $547 million compared with $537 million in the prior-year quarter. The segment posted operating earnings of $80 million compared with $78 million in the prior-year quarter. However, the segment continues to report negative organic sales growth.
ROK’s Margin Upside Reflects Pricing & Operating Leverage
The cost of sales increased 8.3% year over year to $1.11 billion. The gross profit grew 15.8% to $1.12 billion. Selling, general and administrative expenses moved up 1.9% to $478 million.
Profitability improved sharply as Rockwell Automation converted higher volumes into stronger margins. The enterprise operating margin increased 350 basis points year over year to 22.5% in the quarter, alongside a pretax margin of 19.7%.
At the segment level, Intelligent Devices delivered a 20.9% operating margin, up 320 basis points year over year, and Software & Control reached 34.9%, up 480 basis points. Lifecycle Services was essentially flat year over year at 14.6%.
Rockwell Automation’s Cash Position & Balance Sheet Updates
Cash generation strengthened alongside earnings. Cash provided by operating activities was $320 million in the quarter compared with $199 million in the year-ago period.
The free cash flow improved to $275 million from $171 million. Rockwell Automation’s adjusted income was $373 million and free cash flow conversion was 74% for the quarter.
Cash and cash equivalents were $423 million at the quarter end, down from $468 million at the end of fiscal 2025.
Long-term debt stood at $2.57 billion, modestly below $2.61 billion at the end of fiscal 2025. The balance sheet positioning gives Rockwell Automation flexibility as it navigates portfolio actions, including the Sensia dissolution-related impacts discussed in its materials.
Raises FY26 Earnings View
The company lifted its full-year outlook following the strong quarter. ROK raised both its reported and organic sales growth view to 5-9% year over year and expects an Enterprise operating margin of 21.5%, up from the prior mentioned 20%.
Rockwell Automation also increased its adjusted earnings guidance to $12.50-$13.10 per share from $11.40-$12.20. The updated view reflects broadening demand and execution, while the company noted the guidance does not include sales, earnings or cash flows related to the divested Sensia joint venture businesses in the second half of fiscal 2026.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
The consensus estimate has shifted 7.47% due to these changes.
VGM Scores
At this time, Rockwell Automation has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Charting a somewhat similar path, the stock was allocated a score of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Rockwell Automation has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Rockwell Automation belongs to the Zacks Electronics - Miscellaneous Products industry. Another stock from the same industry, Teradyne (TER - Free Report) , has gained 7.1% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Teradyne reported revenues of $1.28 billion in the last reported quarter, representing a year-over-year change of +87%. EPS of $2.56 for the same period compares with $0.75 a year ago.
Teradyne is expected to post earnings of $1.99 per share for the current quarter, representing a year-over-year change of +249.1%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #1 (Strong Buy) for Teradyne. Also, the stock has a VGM Score of F.