Key Stats for ROK Stock
- 6-Month Performance: 15%
- 52-Week Range: $215 to $439
- Valuation Model Target Price: $471
- Implied Upside: 14.6%
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What Happened?
Rockwell Automation stock is up about 15% over the last 6 months as investors responded to a strong earnings beat and improving confidence in 2026 growth.
Shares have steadily climbed as sentiment improved around automation demand, software momentum, and margin expansion.
The rally was driven primarily by better-than-expected profitability and firm full-year guidance. Rockwell reported quarterly EPS of $2.75 versus $2.46 expected on revenue of $2.11 billion, up 11.9% year over year, and set FY2026 guidance at $11.40 to $12.20 in EPS.
That combination of double-digit revenue growth and clear earnings visibility signaled improving operating leverage, which supported the stock’s upward move.
Analyst updates reinforced the shift in tone. TD Cowen raised its price target to $350 from $330 while maintaining a Hold rating, prompting renewed focus on valuation and forward earnings power.
Estimate revisions and guidance commentary became central to investor positioning as the market recalibrated expectations for 2026 performance.
Institutional activity remained active and largely constructive. JPMorgan Chase & Co. increased its stake by 122.3% to 819,708 shares worth about $286.5 million, while Axxcess Wealth Management boosted its holdings by 199.8% to 4,479 shares.
Skandinaviska Enskilda Banken AB publ raised its position by 10.6%, NEOS Investment Management increased its stake by 14.3%, and HighTower Advisors lifted its holdings by 5%.
On the other hand, Granite Investment Partners trimmed its stake by 4.0%, Ontario Teachers reduced its holdings by 2.4%, Somerville Kurt F cut its position by 9.8%, Hemenway Trust lowered its stake by 7.4%, and King Luther Capital Management reduced its holdings by 1.0%.
Institutional investors now own roughly 75.75% of the company, underscoring continued large-cap participation despite selective trimming.
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Is ROK Undervalued?
Under valuation assumptions, the stock is modeled using:
- Revenue Growth (CAGR): 6.1%
- Operating Margins: 21.2%
- Exit P/E Multiple: 29x
Revenue growth assumptions reflect a steady recovery in discrete automation, continued expansion in lifecycle services, and deeper software penetration across Rockwell’s installed base rather than a sharp cyclical surge.
Margin expansion toward 21.2% depends on higher software mix, improved plant utilization, disciplined pricing, and conversion of larger intelligent device and digital transformation projects into revenue.
Key drivers in 2026 include continued growth in Logix controllers, expansion in data center automation, reshoring-related capital spending in North America, and recurring revenue from software and cybersecurity contracts.
Annual recurring revenue now represents a little over 10% of total sales, supporting greater earnings durability and reducing sensitivity to short-cycle industrial volatility.
Incremental margins are expected to remain strong as pricing realization and cost discipline support operating leverage.
Based on these inputs, the model estimates a target price of $471, implying about 14.6% total upside over roughly 2.6 years.
At current levels, Rockwell Automation appears moderately undervalued, with future performance driven by software mix expansion, margin durability, and steady automation demand rather than aggressive top-line acceleration.
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How Much Upside Does ROK Have From Here?
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All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
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