Rockwell Automation (ROK) came out with quarterly earnings of $ 1.66 per share, missing the Zacks consensus estimate of $ 2.27 per share. This compares to earnings of $ 2.41 per share from a year ago. These values are adjusted for non-recurring items.
This quarterly report represents a surprise on earnings of -26.87%. A quarter ago, this industrial equipment and software maker was expected to post earnings of $ 2 per share when it actually produced earnings of $ 2.14, delivering a 7% surprise.
In the past four quarters, the company has exceeded consensus estimates on EPS three times.
Rockwell Automation, which belongs to Zacks’ industrial automation and robotics business, reported revenues of $ 1.81 billion for the quarter ended March 2022, missing the Zacks consensus estimate of 7.12%. This compares with revenue of $ 1.78 billion a year ago. The company has surpassed consensus revenue estimates twice in the past four quarters.
The sustainability of the stock price’s immediate move based on recently released numbers and future earnings expectations will largely depend on management’s comment on earnings demand.
Rockwell Automation shares have lost about 28.3% since the beginning of the year against the decline of the S&P 500 of -12.8%.
What are the prospects for Rockwell Automation?
Although Rockwell Automation has underperformed the market so far this year, the question that comes to investors’ minds is: what are the prospects for the stock?
There are no easy answers to this key question, but a reliable measure that can help investors address this problem is the company’s earnings outlook. Not only does this include the current consensus earnings expectations for the next few quarters, but also how these expectations have changed recently.
Empirical research shows a strong correlation between short-term equity movements and trends in earnings estimate revisions. Investors can track such revisions on their own or rely on a proven valuation tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Prior to this earnings release, the trend in estimates revisions for Rockwell Automation: mixed. While the magnitude and direction of estimate revisions may change following the company’s newly released earnings report, the current status translates to a Zacks Rank # 3 (Hold) for the stock. Therefore, the shares are expected to be in line with the market in the near future. You can see the full list of Zacks # 1 Rank (Strong Buy) stock today here.
It will be interesting to see how the estimates change for the next few quarters and for the current fiscal year in the coming days. The current consensus EPS estimate is $ 2.85 on $ 2.07 billion in revenue for the next quarter and $ 10.51 on $ 8.04 billion in revenue for the current fiscal year.
Investors should be aware that the outlook for the sector can also have a significant impact on the stock’s performance. In terms of Zacks Industry Rank, industrial automation and robotics are currently in the top 39% of the more than 250 Zacks industries. Our research shows that the richest 50% of Zacks-rated industries outnumber the poorest 50% by a factor of more than 2 to 1.
iRobot (IRBT), another stock in the same industry, has not yet reported results for the quarter ended March 2022. Results are expected to be released on May 4.
This robotic technology company is expected to post a quarterly loss of $ 1.38 per share in its next report, representing a year-over-year change of -436.6%. The consensus estimate on EPS for the quarter has remained unchanged for the past 30 days.
IRobot’s revenue is expected to be $ 302.44 million, down 0.3% from the quarter a year ago.
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