The last three months haven’t been particularly kind to Rockwell (ROK),
as the share price of what is usually a darling among industrials has
lagged the broader industrial sector, and automation peers like Yaskawa (OTCPK:YASKY), Fanuc (OTCPK:FANUY), Nidec (OTCPK:NJDCY), Emerson (EMR), Schneider (OTCPK:SBGSY), and even ABB (ABB).
To be fair, it was the significant slide after second quarter earnings
on Thursday that did the damage, though the shares had still been
lagging most automation companies (except ABB) and were only slightly
better than the average industrial before the report.
Like 3M (MMM), Sandvik (OTCPK:SDVKY), SKF (OTCPK:SKFRY), Illinois Tool Works (ITW),
and the Japanese automation companies, weakness in autos is a major
contributor to Rockwell’s present weakness, but I took management’s
guidance and comments as reflective of some potential warnings about
spreading weakness in other industrial end-markets – something that I’ve
been expecting as this year rolls on. Rockwell shares are now in a
tough situation valuation-wise; they’re not so clearly undervalued that
I’m inclined to say “just buy and wait for the cycle to reverse), but
the valuation is getting more reasonable and this is a stock to watch
more carefully now.
Read more here:
Rockwell Skids On A Weaker Auto End-Market
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