Is It Too Late To Consider Rockwell Automation After Its Strong 2025 Share Price Rally?

• If you are wondering whether Rockwell Automation is still worth considering after its big multi year run, or if the stock is already priced for perfection, this breakdown is for you.
• Shares have climbed 42.8% year to date and 38.9% over the past year, with a 6.4% gain in the last month and the price now around $401.08.
• Investors have been watching Rockwell as industrial automation and digitalization spending remain in focus, with ongoing interest in robotics, smart factories, and connected industrial systems. These structural themes help explain why the market has been willing to pay up for quality names in this space such as Rockwell.
• Despite that optimism, Rockwell scores just 0 out of 6 on our valuation checks. We will walk through how different valuation approaches stack up for the stock, and then finish with a more intuitive way to make sense of value beyond the usual models.

Rockwell Automation scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Rockwell Automation Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth today by projecting its future cash flows and then discounting those back to their value in today’s dollars. For Rockwell Automation, we start from last year’s free cash flow of about $1.36 billion and use analyst forecasts for the next few years, with Simply Wall St extending those projections out to 10 years under a 2 stage Free Cash Flow to Equity approach.

On this basis, Rockwell’s free cash flow is expected to grow steadily, reaching roughly $1.89 billion by 2029 and continuing to climb in the years that follow. When all of those projected cash flows are discounted back to today using an appropriate required return for shareholders, the model arrives at an intrinsic value of about $270.31 per share.

Compared with the current share price of around $401, the DCF suggests the stock is about 48.4% overvalued, implying that a lot of future growth is already priced in.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Rockwell Automation may be overvalued by 48.4%. Discover 909 undervalued stocks or create your own screener to find better value opportunities.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Rockwell Automation.

Approach 2: Rockwell Automation Price vs Earnings

The price to earnings ratio is a useful yardstick for valuing established, profitable companies because it directly links what investors pay today with the earnings the business is already generating. In general, faster expected earnings growth and lower perceived risk justify a higher PE multiple, while slower growth or higher uncertainty point to a lower, more conservative PE.

Rockwell currently trades on a PE of about 51.9x, which is well above both the Electrical industry average of roughly 31.8x and the broader peer group at around 37.8x. To move beyond these blunt comparisons, Simply Wall St uses a proprietary Fair Ratio, which estimates the PE you would reasonably expect given Rockwell’s earnings growth outlook, profit margins, industry, market capitalization and risk profile. For Rockwell, that Fair Ratio is 33.8x, suggesting a more modest multiple than the market is currently assigning.

Because the Fair Ratio incorporates company specific drivers rather than relying only on peer and industry averages, it offers a more tailored sense of what Rockwell should be worth. Comparing 33.8x to the actual 51.9x indicates the shares look significantly overvalued on an earnings based view.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Rockwell Automation Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, a simple way to turn your view of a company into a story that links assumptions about future revenue, earnings and margins to a fair value estimate you can actually act on.

A Narrative on Simply Wall St is your story behind the numbers. It is where you spell out why you think Rockwell will grow in certain markets, how its margins might evolve, and what you believe is a reasonable valuation multiple. The platform then automatically converts that story into a full financial forecast and Fair Value.

Because Narratives live on the Community page used by millions of investors, they are easy to create, compare and refine. They also stay up to date as new information such as earnings, guidance or major news is fed into the underlying data.

For Rockwell Automation, one investor might build a bullish Narrative that leans into automation demand, rising software margins and recent price target changes to support a Fair Value near the top of the analyst range. Another investor might focus on delayed customer CapEx, geopolitical risks and tax headwinds to anchor a much lower Fair Value closer to the most bearish target. Each investor can then compare their Fair Value to the current share price to decide whether Rockwell looks like a buy, hold or sell today.

Do you think there's more to the story for Rockwell Automation? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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