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What's in the Cards for Rockwell Automation's (ROK) Q2 Earnings?

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Rockwell Automation Inc. ROK is scheduled to report second-quarter fiscal 2021 results, before market open on Apr 28.

Q2 Estimates

The Zacks Consensus Estimate for fiscal second-quarter revenues is pegged at $1.70 billion, indicating growth of 1.3% from the prior-year quarter. The same for earnings is pinned at $2.15, suggesting a decline of 11.5% from the year-ago figure.

Q1 Performance

In the last reported quarter, Rockwell Automation’s adjusted earnings per share beat the Zacks Consensus Estimate and improved year over year. However, revenues missed the Consensus Mark and declined year on year.

The company has a trailing four-quarter average earnings surprise of 18.7%.

Rockwell Automation, Inc. Price and EPS Surprise

Rockwell Automation, Inc. Price and EPS Surprise
Rockwell Automation, Inc. Price and EPS Surprise

Rockwell Automation, Inc. price-eps-surprise | Rockwell Automation, Inc. Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Rockwell Automation this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP for Rockwell Automation is +1.10%.

Zacks Rank: Rockwell Automation currently carries a Zacks Rank #3.

Factors to Note

Rockwell Automation witnessed a sharp increase in orders in first-quarter fiscal 2021, higher than the pre-pandemic levels. Demand was particularly robust for Intelligent Devices and Information Solutions, and is likely to be strong in the near term. These are likely to have boosted the top-line performance in the fiscal second quarter as well. Moreover, improved manufacturing activities in the United States and upbeat industrial production data indicate that Rockwell Automation had witnessed improved order levels over the course of the fiscal second quarter.

Demand for packaged food and beverages has been strong amid travel restrictions imposed by governments worldwide. Rockwell Automation's Food & Beverage business is roughly 70% retail for grocery stores and home delivery, and 30% foodservice for restaurants. Demand has also picked up in the automotive industry owing to the relaxation of the pandemic-induced restrictions, pent-up demand, easier credit conditions and preference for personal mobility. Also, demand in the semiconductor industry is improving. These factors are likely to get reflected in the company’s fiscal second-quarter top line.

Moreover, focus on productivity improvements and material cost savings are anticipated to have benefited the company’s bottom line during the quarter under review. Notably, Rockwell Automation implemented temporary cost-containment measures and saved around $150 million in fiscal 2020.

Share Price Performance

Over the past year, Rockwell Automation’s shares have gained 58.2% compared with the industry’s growth of 59.7%.


Other Stocks Poised to Beat Earnings Estimates

Here are some other Industrial Products stocks, which you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:

Deere & Company DE has an Earnings ESP of +1.13% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Caterpillar Inc. CAT has an Earnings ESP of +3.15% and carries a Zacks Rank #2.

AGCO Corp. AGCO has an Earnings ESP of +2.94% and holds a Zacks Rank of 3.

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