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Roper Technologies (ROP) Up 0.3% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Roper Technologies (ROP - Free Report) . Shares have added about 0.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Roper Technologies due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Roper Technologies Q1 Earnings & Revenues Top Estimates
Roper kept its earnings streak alive in the first quarter of 2019, pulling off a positive earnings surprise of 18.7%.
Adjusted earnings in the reported quarter were $3.30 per share, surpassing the Zacks Consensus Estimate of $2.78. Also, quarterly earnings increased 26.4% from the year-ago quarter number of $2.61 backed by solid revenue growth.
Inside the Headlines
Roper’s adjusted revenues in the first quarter came in at $1,288 million, indicating growth of 7% year over year. This improvement was primarily driven by 6% organic growth and 2% gain from acquired assets, partially offset by 1% adverse impact of unfavorable movements in foreign currencies. Further, the top line surpassed the Zacks Consensus Estimate of $1,277 million.
Revenues, including purchase accounting adjustment to acquired deferred revenues, were $1,287 million, up from the year-ago reported figure of $1,203 million.
The company reports revenues under four segments. A brief discussion of the quarterly results is provided below:
Application Software’s revenues totaled $381.2 million, representing 29.6% of the reported quarter’s revenues. On a year-over-year basis, the segment’s revenues grew 17.6%.
The Network Software & Systems segment generated revenues of $345.7 million, accounting for roughly 26.8% of the first quarter’s revenues. Sales grew 10.1% year over year.
The Measurement & Analytical Solutions segment generated revenues of $401.8 million, accounting for roughly 31.2% of the quarter’s revenues. Sales declined 0.5% year over year.
The Process Technologies segment generated revenues of $158.5 million, accounting for roughly 12.4% of the March-end quarter’s revenues. Sales edged down 1.4% year over year.
Margin Details
In the January-March quarter, Roper’s cost of sales increased 5.4% year over year to $476.6 million. Cost of sales was 37% of the quarter’s revenues versus 37.6% witnessed in the year-ago quarter. Adjusted gross profit in the quarter increased 8% year over year to $811 million, with margin at 63%, reflecting year-over-year expansion of 50 basis points (bps).
Selling, general and administrative expenses flared up 3.1% year over year to $464.2 million. It represented 36.1% of revenues in the reported quarter versus 37.4% in the year-ago quarter. Operating profit jumped 12.6% year over year to $384.9 million, with year-over-year growth of 150 bps in the margin to 29.9%.
Balance Sheet & Cash Flow
Exiting the first quarter, Roper had cash and cash equivalents of $392.5 million, compared with $364.4 million recorded as of Dec 31, 2018. Long-term debt decreased 9.2% sequentially to $4,487 million.
In the reported quarter, the company generated net cash of $290.3 million from operating activities, roughly 3% higher than the year-ago tally. Capital expenditure totaled $15.8 million, higher than the year-ago figure of $9.7 million. Adjusted free cash flow in the quarter was up 15% year over year to $312 million.
Outlook
For 2019, adjusted earnings per share are anticipated to be $12.70-$13.00, higher than the range of $12.00-$12.40 guided earlier.
For the second quarter of 2019, earnings are projected at $3.00-$3.04 per share.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months.
VGM Scores
Currently, Roper Technologies has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Roper Technologies has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Roper Technologies (ROP) Up 0.3% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Roper Technologies (ROP - Free Report) . Shares have added about 0.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Roper Technologies due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Roper Technologies Q1 Earnings & Revenues Top Estimates
Roper kept its earnings streak alive in the first quarter of 2019, pulling off a positive earnings surprise of 18.7%.
Adjusted earnings in the reported quarter were $3.30 per share, surpassing the Zacks Consensus Estimate of $2.78. Also, quarterly earnings increased 26.4% from the year-ago quarter number of $2.61 backed by solid revenue growth.
Inside the Headlines
Roper’s adjusted revenues in the first quarter came in at $1,288 million, indicating growth of 7% year over year. This improvement was primarily driven by 6% organic growth and 2% gain from acquired assets, partially offset by 1% adverse impact of unfavorable movements in foreign currencies. Further, the top line surpassed the Zacks Consensus Estimate of $1,277 million.
Revenues, including purchase accounting adjustment to acquired deferred revenues, were $1,287 million, up from the year-ago reported figure of $1,203 million.
The company reports revenues under four segments. A brief discussion of the quarterly results is provided below:
Application Software’s revenues totaled $381.2 million, representing 29.6% of the reported quarter’s revenues. On a year-over-year basis, the segment’s revenues grew 17.6%.
The Network Software & Systems segment generated revenues of $345.7 million, accounting for roughly 26.8% of the first quarter’s revenues. Sales grew 10.1% year over year.
The Measurement & Analytical Solutions segment generated revenues of $401.8 million, accounting for roughly 31.2% of the quarter’s revenues. Sales declined 0.5% year over year.
The Process Technologies segment generated revenues of $158.5 million, accounting for roughly 12.4% of the March-end quarter’s revenues. Sales edged down 1.4% year over year.
Margin Details
In the January-March quarter, Roper’s cost of sales increased 5.4% year over year to $476.6 million. Cost of sales was 37% of the quarter’s revenues versus 37.6% witnessed in the year-ago quarter. Adjusted gross profit in the quarter increased 8% year over year to $811 million, with margin at 63%, reflecting year-over-year expansion of 50 basis points (bps).
Selling, general and administrative expenses flared up 3.1% year over year to $464.2 million. It represented 36.1% of revenues in the reported quarter versus 37.4% in the year-ago quarter. Operating profit jumped 12.6% year over year to $384.9 million, with year-over-year growth of 150 bps in the margin to 29.9%.
Balance Sheet & Cash Flow
Exiting the first quarter, Roper had cash and cash equivalents of $392.5 million, compared with $364.4 million recorded as of Dec 31, 2018. Long-term debt decreased 9.2% sequentially to $4,487 million.
In the reported quarter, the company generated net cash of $290.3 million from operating activities, roughly 3% higher than the year-ago tally. Capital expenditure totaled $15.8 million, higher than the year-ago figure of $9.7 million. Adjusted free cash flow in the quarter was up 15% year over year to $312 million.
Outlook
For 2019, adjusted earnings per share are anticipated to be $12.70-$13.00, higher than the range of $12.00-$12.40 guided earlier.
For the second quarter of 2019, earnings are projected at $3.00-$3.04 per share.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months.
VGM Scores
Currently, Roper Technologies has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Roper Technologies has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.