Rockwell Hit Record High Last Month. Prepping For A Fresh Run To The Top?

Diversified manufacturer Rockwell Automation (ROK) hit an all-time high in early February. It consolidated for a month and could be rising toward a fresh high.

Rockwell shares dipped to a 347.63 low last Wednesday. The Milwaukee-based company’s stock traded near 360 Monday afternoon, looking to close higher two of the last three trading days.

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Also on Monday, the IBD Relative Strength (RS) Rating for ROK stock got an upgrade to 73, up from 70 on Friday. It’s a welcome improvement for the watchlist candidate.

Over 100 years of market history reveals that the best stocks typically have an RS Rating of over 80 as they begin their biggest price moves. See if Rockwell Automation can continue to show renewed price strength and hit that benchmark.

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Rockwell makes motion, power control, safety and sensing devices. It also provides production automation software platforms, technology, cybersecurity and consulting services. Several of those categories are used in building data centers, and Rockwell is benefiting from the AI megatrend.

Earnings jumped 50% last quarter to $2.75 per share. Earnings growth has accelerated over the last four quarters. EPS rose from a 2% dip four quarters ago to 4%, 35% and then 50%. Revenue grew 12% last quarter to $2.11 billion, edging down from 14% growth the prior quarter.

Rockwell stock also has a strong 90 rating for both its overall Composite Rating and its EPS Rating. However, it has a weak E Accumulation/Distribution Rating, showing that funds are selling more shares than buying. No doubt in part that reflects weak earnings and revenue growth in the first half of last year. Look for that to improve to a C or better rating.

The company earns the No. 12 rank among its peers in the Electrical Power/Equipment industry group. NVent Electric (NVT), Vertiv Holdings (VRT) and Allient (ALNT) are among the top five highly rated stocks within the group.

The unique IBD Relative Strength Rating tracks technical performance by using a 1 (worst) to 99 (best) score that identifies how a stock’s price action over the last 52 weeks compares with the rest of the market.

This article was created automatically with Stats Perform’s Wordsmith software using data and article templates supplied by Investor’s Business Daily. An IBD journalist may have edited the article.

Please follow James DeTar on Twitter @JimDeTar

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