Rockwell Automation (ROK) Beats Q1 Earnings, Revenues Miss - Tale of the Tape
Rockwell Automation Inc. (ROK) is the world’s largest company dedicated to industrial automation. Its products, services and solutions address a broad range of challenges in every major industrial sector, from automotive and tire to mining and oil and gas, from pharmaceuticals to food and beverage. Its brands include Allen-Bradley, Reliance Electric and Rockwell Software.
Rockwell’s growth and performance strategy seeks to achieve growth rates in excess of the automation market by expanding its served market, diversifying sales streams by broadening portfolio of products, solutions and services, expanding its global presence, growing market share and making acquisitions. However, weakness in the mining industry, lack of major projects, concern regarding capital spending due to low oil prices remain headwinds.
Investors have thus been eagerly awaiting the company’s fiscal 2015 second quarter earnings report. Let’s have a quick look at the earnings release of this Milwaukee, WI-based provider industrial automation power, control, and information solutions.
Estimate Trend & Surprise History: The Zacks Consensus estimate for Rockwell Automation for the first quarter has moved slightly downwards over the past month. As regards earnings surprise in the past 4 quarters, Rockwell Automation’s performance has been mixed, outpacing the Zacks Consensus Estimate in only two quarters, with an average beat of 0.06%.
Earnings: Rockwell Automation beat on earnings by a wide margin. Our consensus called for EPS of $1.42, and the company reported EPS of $1.59.
Revenue: Rockwell Automation however missed on revenues. It reported second quarter fiscal 2015 revenues of $1,551 million, failing to match the Zacks Consensus Estimate of $1,555 million. Solid organic sales growth was more than offset by a large currency headwind.
Key Developments to Note: Rockwell Automation lowered its fiscal 2015 sales to around $6.4 billion from the previous $6.6 billion based on a softer forecast for industrial production growth, a reduced outlook for oil and gas and currency headwind. The company however maintained its EPS guidance range of $6.50 to $6.80.
Zacks Rank: Currently, Rockwell Automation has a Zacks Rank #3 (Sell). However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change.
Market Reaction: Rockwell Automation’s shares were inactive following the release. It would be interesting to see how the market reacts to the results during the trading session today.
Check back later for our full write up on this Rockwell Automation earnings report later!
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