Investors seeking exposure in the industrial machinery space can choose from stocks that sport a Zacks Rank #1 (Strong Buy) or #2 (Buy). Of the many investment options, we believe that Roper Technologies, Inc. (ROP - Free Report) will be a smart choice. This Sarasota, FL-based company’s stock currently carries a Zacks Rank #2.
The industry, to which Roper belongs, is currently positioned in the top 40% of more than 250 Zacks industries. Per our research, the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. We believe that the strengthening housing market, infrastructural development, lower taxes (due to the implementation of the U.S. Tax Cuts and Jobs Act), solid manufacturing activities and other tailwinds aid the industry.
Below, we discussed why investing in Roper will be a smart choice for investors.
Share Price Performance, Impressive Earnings Outlook: Market sentiments seem to be working in favor of Roper over time. In the past three months, the company’s share price has improved 7.5% compared with the industry’s growth of 2.7% and the Zacks Industrial Products sector’s increase of 2.1%.
The company delivered impressive results for the fourth quarter of 2018, with earnings beating estimates by 2.88%. On a year-over-year basis, the bottom line expanded 19.3% on the back of solid revenue growth and margin improvement.
For 2019, the company anticipates that stronger sales, the unique niche market strategy, healthy balance sheet and gains from acquired assets will drive bottom-line performance. Adjusted earnings per share are predicted to be $12-$12.40, higher than $11.81 recorded in 2018. Earnings for the first quarter are estimated to be $2.74-$2.80 per share.
Impressive results and solid outlook created positive sentiments for Roper. In the past 30 days, earnings estimates for 2019 have been raised by three brokerage firms, and that for 2020 increased by one firm and lowered by one. Currently, the Zacks Consensus Estimate for earnings is pegged at $12.27 for 2019 and $12.73 for 2020, reflecting growth of 0.7% and 0.6% from the respective tallies 60 days ago.
Roper Technologies, Inc. Price and Consensus