Key Takeaways
- Rockwell Automation CEO Blake Moret bought $1.5 million of stock on Nov. 9, four days after shares fell 13% on the company’s fiscal fourth-quarter report.
- The stock trades 21% below its June high, but it’s still up 5% over the past year.
- Analysts expect adjusted EPS to grow by double digits in fiscal 2027 and 2028, and they haven’t cut their estimates since the report.
- At 26x forward earnings, Moret paid about the stock’s five-year average multiple, a fair price that TIKR’s numbers back.
Rockwell Automation (ROK) stock sank 13% on Nov. 5 after its fiscal fourth-quarter report. Four days later, its chairman and CEO bought $1.5 million of it.
Blake Moret bought 4,000 shares on Nov. 9 at a weighted average of $386.36 each, according to the Form 4 he filed the same day. The stock trades at $393.15, just above what he paid, and 21% below its June 30 high of $497.36. Over the past year, it’s up 5%.
A strong year, then a messy quarter
Rockwell’s fourth-quarter sales of $2.33 billion came in below estimates, after the company set aside $85 million to refund customers who had paid its tariff-related price increases. That came straight out of sales and took about 4 points off the quarter’s growth, leaving reported sales up just 1%. Leave out the refunds and the dissolved Sensia joint venture, and Rockwell puts its core sales growth at 7%. Adjusted EPS rose 27% to $13.42 for fiscal 2026, and Rockwell guides to $14.50-$15.50 for fiscal 2027, on organic sales growth of 6%-9%.
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A small add to a big stake
The shares went into a family trust that now holds 99,285 Rockwell shares, worth $38.4 million at the price Moret paid. So the buy grew that stake by 4%, a small add for someone with that much already riding on the stock. He also paid less than his own company did: Rockwell spent $500 million buying back about 1.2 million shares in its September quarter, more than $400 a share on average.
On the call, Moret was asked how fast semiconductors and data centers could grow. Rockwell will report the two as one vertical from fiscal 2027, at about 10% of revenue, and he said Rockwell expects mid-teens growth there in fiscal 2027. “I just don’t see that trend slowing down,” he added. A CEO adding $1.5 million of his own money four days after a 13% drop is the kind of buy worth tracking.
He paid about what Rockwell usually costs
Analysts didn’t cut their earnings estimates after the report. The consensus for fiscal 2027 adjusted EPS is $14.98, up from $14.83 three months ago, and it climbs to $16.69 in fiscal 2028:
The refunds hit sales far more than earnings, so I don’t see anything in this report that should pull those estimates down.
At Monday’s close, the stock traded at 26x forward earnings. That’s a little below its five-year average of 27x and far below the 36x it hit at the June peak:
The Street’s targets have come down a bit since the report. On Nov. 6, Mizuho cut its target to $375, below the price, and Morgan Stanley cut its target to $470. The consensus target is now $459, off its mid-September high of $479 but still 17% above the price:
The numbers back him
The main risk is the recurring revenue Rockwell is trying to build. Organic ARR grew 5% in fiscal 2026. On the call, Moret said that “ARR growth did not meet our expectations,” and he pointed to delayed projects and customers scaling back rollouts.
The way I see it, the numbers back Moret’s buy. He paid about the stock’s average multiple for a company that analysts expect to grow earnings by double digits for two more years, and the Street’s average target is well above his price. Of course, one CEO’s purchase is only a reason to look closer, and Rockwell still has to deliver that 6%-9% organic growth. The next test is its Investor Day in Boston later this month, where Moret said Rockwell will update its long-term margin targets.
So what is Rockwell Automation stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
