Rockwell: Poised To Benefit From Enterprise Digitalization And Automation

Jul. 07, 2022 6:12 PM ETRockwell Automation, Inc. (ROK)MAKX, ECOZ, PAVE, FDG, SNSR, ROBO, IPDP, RGI
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Cavenagh Research
3.72K Followers

Summary

  • Rockwell Automation is a leading vendor for industrial automation services. The company supports companies across a broad range of manufacturing activities and enterprise digitalization.
  • I am bullish on Rockwell Automation as I see enterprise automation as one of the most attractive secular growth drivers for the next few years.
  • ROK stock is down >40% YTD and long-term investors might appreciate the share-price weakness as a buying opportunity.
  • Based on a residual earnings framework, which I anchor on consensus analyst EPS estimates, I calculate a fair implied share price of $234.49/share.

2020: Rockwell Automation Canada Ltd corporate office is shown in Cambridge, On, Canada

JHVEPhoto/iStock Editorial via Getty Images

Thesis

Rockwell Automation, Inc. (NYSE:ROK) stock is down >40% YTD, and long-term investors might appreciate the share-price weakness as a buying opportunity. Personally, I am bullish on Rockwell Automation, as I see enterprise automation as one of the most attractive

Rockwell Overview

Investor Presentation

ROK price target

Seeking Alpha

ROK valuation

Analyst Consensus; Author's calculation

ROK valuation sensitivity table

Analyst Consensus; Author's calculation

This article was written by

Cavenagh Research profile picture
3.72K Followers
5y experience as an investment analyst for a major BB-Bank. Currently working towards the CFA charter. Passion for risk-assets (Growth, Contrarian, Emerging Market) ex-colleague and close friend of Investor Express

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: not financial advice

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