Rockwell Automation Analysts Reduce Their Forecasts After Downbeat Earnings

Rockwell Automation, Inc. ROK reported worse-than-expected first-quarter results on Wednesday.

Sales grew 3.6% Y/Y to $2.05 billion, missing the consensus of $2.099 billion. Organic sales increased by 1.0% Y/Y in the quarter. Adjusted EPS of $2.04 missed the analyst consensus of $2.64, according to data from Benzinga Pro.

Intelligent Devices sales declined 1.0% Y/Y to $927 million, Software & Control rose 5.3% Y/Y to $604 million, and Lifecycle Services climbed 10.5% to $521 million.

Rockwell reaffirmed adjusted EPS of $12.00 – $13.50 (vs. consensus of $12.89), with reported sales growth guidance of 0.5% – 6.5% and organic sales growth of (2.0)% – 4.0%.

"Rockwell had an encouraging start to the fiscal year, with both organic and total sales up low single digits year over year. Importantly, we saw an upward inflection in customer order activity, with total orders up double digits sequentially. Q1 orders were up sequentially across all business segments and regions, with particular strength in North America. High levels of channel inventory and some lingering supply chain constraints continue to impact the timing of product shipments, but underlying conditions remain positive," said Blake Moret, Chairman and CEO.

Rockwell Automation shares dipped 17.6% to close at $253.28 on Wednesday.

These analysts made changes to their price targets on Rockwell Automation after the company reported quarterly results.

• Daiwa Capital cut the price target on Rockwell Automation from $338 to $310. Daiwa Capital analyst Jairam Nathan upgraded the stock from Outperform to Buy.
• Wells Fargo cut Rockwell Automation price target from $357 to $320. Wells Fargo analyst Joe O'Dea maintained an Overweight rating.

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