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Rockwell Automation Announces $1B Share Repurchase Authorization

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Rockwell Automation Inc. (ROK - Free Report) announced that its board of directors authorized an additional $1 billion in repurchases of its common stock. This move reinforces the company's dedication to delivering value to its shareholders.

Rockwell Automation’s Focus on Capital Allocation Bodes Well
On May 2, 2022, the company authorized the repurchase of $1 billion in common shares. As of Sept. 5, 2024, there was roughly $353 million remaining.

Over the last five years, Rockwell Automation returned $4.7 billion to shareholders through dividends and share repurchases. The company maintains a strong financial position with regard to capital structure, cost-containment actions and liquidity. 

ROK’s Q3 Earnings Decline Y/Y on Lower Volumes

Rockwell Automation reported adjusted earnings per share of $2.71 in third-quarter fiscal 2024, which surpassed the Zacks Consensus Estimate of $2.11. The bottom line declined 10% year over year, attributed to lower sales volume in the Intelligent Devices, and Software & Control segments, which was offset by the improved performance of the Lifecycle Services segment.

Total revenues were $2.05 billion, down 8.4% from the prior-year quarter. The top line beat the Zacks Consensus Estimate of $2.02 billion. Organic sales were down 8.4%. We projected an 11.8% year-over-year decline in organic sales. The variance was mainly due to the better-than-expected performance of the Lifecycle Services segment.

Rockwell Automation Anticipates Lower FY24 Sales

ROK expects order levels in the fiscal fourth quarter to improve on a sequential basis but at a slower pace. It anticipates reporting an 8.5% decline in sales in fiscal 2024. The company earlier projected a year-over-year sales decline of 4-6%. Organic sales are anticipated to decline 10%, lower than the earlier mentioned 6-8% decline. 

Rockwell Automation expects an adjusted EPS of $9.60, lower than the earlier stated $10.00-$11.00.

ROK’s Share Price Performance

In the past year, Rockwell Automation’s shares have lost 11.3% compared with the industry’s 15.1% decline.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

ROK’s Zacks Rank & Stocks to Consider

Rockwell Automation currently has a Zacks Rank #4 (Sell).

Some better-ranked stocks from the Industrial Products sector are Crane Company (CR - Free Report) , Flowserve Corporation (FLS - Free Report) and Cintas Corporation (CTAS - Free Report) . These three companies have a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Crane’s 2024 earnings is pegged at $5.07 per share. The consensus estimate for 2024 earnings has moved north by 6% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 11.2%. CR shares have gained 75.2% in a year.

Flowserve has an average trailing four-quarter earnings surprise of 18.2%. The Zacks Consensus Estimate for FLS’ 2024 earnings is pinned at $2.76 per share, which indicates year-over-year growth of 31.6%. The consensus estimate for 2024 earnings has moved north by 4% in the past 60 days. The company’s shares have gained 27.5% in a year.

The Zacks Consensus Estimate for Cintas’ 2024 earnings is pegged at $16.64 per share. The consensus estimate for 2024 earnings has moved north by 1% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 4%. CTAS shares have gained 60.4% in a year.

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