Rockwell Automation Earnings: The Streak is Snapped

Although S&P 500 (NYSE:SPY) component Rockwell Automation Inc.’s (NYSE:ROK) net income fell in the fourth quarter from a year earlier, profit exceeded analysts’ expectations. Rockwell Automation provides industrial automation power, control and information solutions to customers in the manufacturing sector.

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Rockwell Automation Inc. Earnings Cheat Sheet

Results: Net income for Rockwell Automation Inc. fell to $195.2 million ($1.38 per share) vs. $201.8 million ($1.39 per share) a year earlier. This is a decline of 3.3% from the year-earlier quarter.

Revenue: Rose 0.6% to $1.66 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Rockwell Automation Inc. reported adjusted net income of $5.29 per share. By that measure, the company beat the mean estimate of $1.32 per share. It beat the average revenue estimate of $1.6 billion.

Quoting Management: Commenting on the results, Keith D. Nosbusch, chairman and chief executive officer, said, “I was pleased with five percent organic sales growth in the quarter, especially given the tough comparison to last year’s very strong fourth quarter. While growth rates continued to moderate due to a difficult economic environment, once again every region delivered organic growth. We initiated restructuring actions that reduced margins in the quarter. Those actions provide us with some headroom to rebalance investments in 2013.”

Key Stats:

Last quarter’s profit decrease breaks a streak of four consecutive quarters of year-over-year profit increases. In the third quarter, net income rose 6.2% from the year earlier, while the figure increased 0.8% in the second quarter, 22.1% in the first quarter and 53.7% in the fourth quarter of the last fiscal year.

Revenue has increased for four consecutive quarters. Revenue increased 2.9% to $1.56 billion in the third quarter. The figure rose 6.6% in the second quarter from the year earlier and climbed 7.9% in the first quarter from the year-ago quarter.

The company has beaten estiamtes for two quarters in a row. In the third quarter, it topped expectations with net income of $1.33 versus a mean estimate of net income of $1.31 per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved down from $1.29 a share to $1.27 over the last ninety days. For the fiscal year, the average estimate has moved down from $5.10 a share to $5.09 over the last sixty days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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