Rockwell Automation (ROK)
Industrials · $43.7B market cap · SEC CIK 0001024478
ahead of 25% of the S&P 500 · #62 of 79 in Industrials
Next reports on Feb 3, 2027, with analysts expecting $3.09 in earnings per share.
52-week range $347.53 to $497.36. 20% below its 52-week high and 14% above its low.
The case for ROK
- Earns 33% back on shareholder equity.
- Generated $1.4B of free cash flow in FY2025, 16% of revenue.
- Revenue growing 11.3% year over year.
- Pays a modest 1.8% dividend.
The case against
- Expensive for its growth: 36.4× earnings, where 5% a year of growth plus a 1.8% dividend would justify about 18×.
- Swings harder than the market (beta 1.53).
- The price trend is weak (38/100): +4.2% over a year, −10.5% over three months, 20% below its 52-week high.
- Long-term debt of $2.6B against $468M of cash.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Industrials companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 21 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 47 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 76 |
| Momentumhow the price has behaved lately | 38 |
| Stabilityhow violently it moves, what it owes and what it pays you | 46 |
- Each factor except momentum is half fixed thresholds, half rank among the 79 Industrials companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +11.3% |
|---|---|
| Over 5 years | +5.7% a year |
| FY2025 revenue | $8.3B (+1%) |
Free cash flow
Is it generating real cash? Yes, plenty
| FY2025 free cash flow | $1.4B |
|---|---|
| Of revenue | 16% |
| Of profit | 156% |
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 55% |
|---|---|
| Operating margin | 15% |
| Net margin, FY24 → FY25 → now | 11.5% → 10.4% → 13.4% |
Debt vs. cash
Is the balance sheet healthy? Yes, the debt is manageable
| Cash | $468M |
|---|---|
| Long-term debt | $2.6B |
| Net debt | $2.1B |
| Years to repay | 1.7 yrs |
Valuation
Is the stock price reasonable? No, expensive
| P/E | 36.4× |
|---|---|
| Fair P/E for its growth | 18× |
| P/FCF | 32.2× |
| Forward P/E | 29.3× |
| EV / EBITDA | 31.0× |
At 36.4× earnings it trades well above the 18× that 5% a year of growth plus a 1.8% dividend would justify. At 32.2× free cash flow it trades well above that same mark.
The financials, five years deep
Pulled from Rockwell Automation's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $8.3B | $8.3B | $9.1B | $7.8B | $7.0B |
| Change on the year | +1% | −9% | +17% | +11% | — |
| Free cash flow | |||||
| Free cash flow | $1.4B | $639M | $1.2B | $682M | $1.1B |
| Of revenue | 16% | 8% | 13% | 9% | 16% |
| Profit margins | |||||
| Gross margin | 48.1% | 46.6% | 48.8% | 40.0% | 41.4% |
| Operating margin | 20.4% | 19.3% | 21.3% | — | — |
| Net margin | 10.4% | 11.5% | 15.3% | 12.0% | 19.4% |
| Debt vs. cash | |||||
| Cash | $468M | $471M | $1.1B | $491M | $662M |
| Long-term debt | $2.6B | $2.6B | $2.9B | $2.9B | $3.5B |
| Net cash (debt) | −$2.1B | −$2.1B | −$1.8B | −$2.4B | −$2.8B |
What Rockwell Automation says it does
Rockwell Automation, Inc. (Rockwell Automation or the Company) is the world’s largest company dedicated to industrial automation and digital transformation. We understand and simplify our customers’ complex production challenges and deliver the most valued solutions that combine technology and industry expertise. As a result, we make our customers more resilient, agile, and sustainable, creating more ways to win. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) for additional information on our business and long-term strategy. The Company continues the business founded as the Allen-Bradley Company in 1903. The privately-owned Allen-Bradley Company was a leading North American manufacturer of industrial automation equipment when the former Rockwell International Corporation (RIC) purchased it in 1985. The Company was incorporated in Delaware in connection with a tax-free…
Risk factors ROK lists in its 10-K
- Enterprise Risk Management - Integrated Framework (2017)
- Adverse changes in macroeconomic or industry conditions may result in decreases in our sales and profitability
- Our profitability and market competitiveness may be adversely impacted by changes in trade policies, including tariffs or other factors
- Our industry is highly competitive
- Volatility and disruption of the capital and credit markets may result in increased costs to maintain our capital structure
- We rely on suppliers to provide equipment, components, and services
- An inability to successfully execute cost productivity and margin expansion initiatives could negatively impact our business and financial results
- Our business success depends on attracting, developing, and retaining highly qualified employees
- We sell to customers around the world and are subject to the risks of doing business in many countries
- An inability to respond to changes in customer preferences could result in decreased demand for our products
- There are inherent risks in our solutions and services businesses
- We rely on our distribution channel for a substantial portion of our sales
- Intellectual property infringement claims of others and the inability to protect our intellectual property rights could harm our business and our customers
- Increasing employee benefit costs and funding requirements could have a negative effect on our operating results and financial condition
- Significant investments in the business may not achieve intended returns and could adversely affect our financial performance
- Failure to identify, manage, complete, and integrate strategic transactions may adversely affect our business or we may not achieve the expected benefits of these transactions
- New governmental actions and regulations could adversely affect our business
- Claims from taxing authorities could have an adverse effect on our income tax expense and financial condition
- Potential liabilities and costs from litigation could reduce our profitability