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Roper Technologies (ROP)
NASDAQ:ROP
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Roper Technologies
(NASDAQ:ROP)78Outperform
Positive Factors
M&A Activity
Roper Technologies is well-positioned to capitalize on increased M&A activity with $5 billion in deployable capital.
Operational Execution
Neptune strength is persisting with strong operational execution across ultrasonic and mechanical offerings.
Negative Factors
EBITDA Margins
Core EBITDA margins are anticipated to be slightly down in the first half before turning positive in the second half.
Roper Technologies (ROP) vs. S&P 500 (SPY)
Market Cap
$62.91B
Dividend Yield0.52%
Average Volume (3M)653.96K
Price to Earnings (P/E)40.8
Beta (1Y)0.67
Revenue Growth13.94%
EPS Growth13.02%
CountryUS
Employees16,800
SectorTechnology
Sector Strength48
IndustrySoftware
Share Statistics
EPS (TTM)14.34
Shares Outstanding107,385,210
10 Day Avg. Volume676,876
30 Day Avg. Volume653,964
Financial Highlights & Ratios
PEG Ratio3.14
Price to Book (P/B)N/A
Price to Sales (P/S)8.94
Price to Cash Flow (P/CF)21.80
P/FCF Ratio23.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$640.67Price Target Upside9.55% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Roper Technologies Business Overview & Revenue Model
Company DescriptionRoper Technologies, Inc. is a diversified technology company that operates in various sectors including medical and scientific imaging, RF technology, software information solutions, and industrial technology. The company is known for its innovative approach and focuses on acquiring and managing businesses that design and develop products and solutions across niche markets. Roper's core services and products span across healthcare, transportation, food, energy, and water industries, providing essential technology and software solutions to improve operational efficiency and productivity.
How the Company Makes MoneyRoper Technologies generates revenue primarily through the sale of software, engineered products, and various technology solutions across its four main business segments: Application Software, Network Software & Systems, Measurement & Analytical Solutions, and Process Technologies. The company follows a business model that emphasizes acquiring niche technology businesses with strong cash flow and growth potentials. Revenue streams include licensing fees, subscription services, product sales, and maintenance and support services. Roper leverages significant partnerships and customer relationships to enhance its earnings, focusing on high-value, recurring revenue models, particularly in its software divisions. The company's strategic acquisitions are a critical driver of revenue growth, allowing Roper to expand its portfolio and market reach.
Roper Technologies Financial Statement Overview
Summary
Roper Technologies demonstrates strong financial health with consistent revenue and profit growth, robust profitability margins, and effective cash flow management. While leverage has increased, the company maintains a solid equity base to support its operations.Income Statement
Roper Technologies shows impressive growth with a consistent increase in revenue over the years. The gross profit margin and net profit margin have improved, indicating strong profitability. The EBIT and EBITDA margins are robust, reflecting efficient operational management. However, the revenue growth rate has been moderate, suggesting room for accelerated market expansion.85
Very Positive
Balance Sheet
The company's balance sheet is stable, with a solid equity base. The debt-to-equity ratio has increased slightly, indicating higher leverage, which could pose a risk if not managed carefully. The return on equity is healthy, demonstrating effective utilization of shareholders' funds. Equity ratio shows a strong asset base, providing a cushion against liabilities.78
Positive
Cash Flow
Roper Technologies has shown strong free cash flow generation, with a positive growth trend. The operating cash flow to net income ratio suggests good cash conversion from profits. Free cash flow to net income ratio is favorable, highlighting effective cash management. However, the significant investing cash flow outlay could impact future cash reserves.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 7.04B | 6.18B | 5.37B | 5.78B | 5.53B | Gross Profit |
| 4.88B | 4.31B | 3.75B | 3.92B | 3.54B | EBIT |
| 2.00B | 1.75B | 1.52B | 1.48B | 1.43B | EBITDA |
| 2.00B | 2.66B | 2.12B | 1.95B | 1.78B | Net Income Common Stockholders |
| 1.55B | 1.38B | 985.60M | 1.15B | 949.70M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 188.20M | 214.30M | 792.80M | 351.50M | 308.30M | Total Assets |
| 31.33B | 28.17B | 26.98B | 23.71B | 24.02B | Total Debt |
| 7.62B | 6.37B | 6.66B | 7.92B | 9.57B | Net Debt |
| 7.43B | 6.16B | 5.87B | 7.57B | 9.26B | Total Liabilities |
| 12.47B | 10.72B | 10.94B | 12.15B | 13.54B | Stockholders Equity |
| 18.87B | 17.44B | 16.04B | 11.56B | 10.48B |
| Cash Flow | Free Cash Flow | |||
| 2.33B | 1.93B | 664.30M | 1.95B | 1.48B | Operating Cash Flow |
| 2.39B | 2.04B | 734.60M | 2.01B | 1.53B | Investing Cash Flow |
| -3.47B | -2.13B | 1.21B | -142.90M | -6.07B | Financing Cash Flow |
| 1.07B | -499.50M | -1.47B | -1.81B | 4.14B |
Roper Technologies Technical Analysis
Positive
584.83
Price Trends
547.74
Positive
550.25
Positive
548.76
Positive
Market Momentum
8.72
Positive
60.55
Neutral
65.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ROP, the sentiment is Positive. The current price of 584.83 is above the 20-day moving average (MA) of 577.83, above the 50-day MA of 547.74, and above the 200-day MA of 548.76, indicating a bullish trend. The MACD of 8.72 indicates Positive momentum. The RSI at 60.55 is Neutral, neither overbought nor oversold. The STOCH value of 65.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ROP.
Roper Technologies Risk Analysis
Roper Technologies disclosed 23 risk factors in its most recent earnings report. Roper Technologies reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Roper Technologies Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $76.96B | 22.39 | 105.16% | 2.21% | -1.30% | 20.26% | |
78 Outperform | $62.91B | 40.84 | 8.21% | 0.52% | 13.94% | 13.02% | |
74 Outperform | $64.30B | 27.12 | 9.14% | 1.80% | 10.29% | 22.72% | |
74 Outperform | $213.34B | 33.27 | 33.90% | 0.55% | -32.60% | -28.55% | |
68 Neutral | $135.18B | 23.89 | 596.13% | 2.08% | 5.05% | 2.73% | |
64 Neutral | $79.19B | 19.31 | 108.62% | 1.84% | -18.72% | ― | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% |
* Technology Sector Average
Performance Comparison
ROP
Roper Technologies
584.83
47.70
8.88%
MMM
3M
145.86
70.23
92.86%
EMR
Emerson Electric Company
114.03
6.18
5.73%
GE
GE Aerospace
198.77
72.40
57.29%
HON
Honeywell International
208.00
11.66
5.94%
ITW
Illinois Tool Works
255.32
0.93
0.37%
Roper Technologies Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: 7.70% | Next Earnings Date: Apr 29, 2025
Earnings Call Sentiment Positive
Roper Technologies concluded 2024 with strong financial and operational performance, highlighted by significant cash flow and revenue growth, strategic acquisitions, and positive momentum into 2025. Despite some restructuring costs and challenges in the Network Software segment, the company's solid financial position and acquisition capacity bode well for continued growth.Highlights
Strong Cash Flow Growth
Roper Technologies reported a 16% growth in free cash flow for 2024, reaching over $2.3 billion with a 32% free cash flow margin, marking the first time in their history to exceed $2 billion.
Record Revenue and Growth
The company achieved a 14% revenue growth in 2024, totaling over $7 billion, with a balanced contribution between organic and inorganic sources.
Significant M&A Capacity
Roper enters 2025 with over $5 billion of available acquisition firepower, indicating a strong position for future growth through mergers and acquisitions.
Enterprise Software Bookings Surge
Enterprise bookings accelerated in 2024, ending in the high-teens growth area in Q4, supporting a positive momentum into 2025.
Impressive Segment Performance
The Application Software segment grew revenue by 21% with a 6% organic growth, while the Tech segment saw a 9% growth on a total and organic basis.
Positive 2025 Outlook
Roper initiates 2025 guidance with expectations of over 10% total revenue growth and 6% to 7% organic revenue growth.
Lowlights
Restructuring Costs
The company incurred $9 million in restructuring costs primarily in the Application Software segment, indicating strategic adjustments and cost optimizations.
Challenges in Network Software Segment
Organic growth in the Network Software segment grew only 3% in 2024, impacted by market conditions in the freight matching business and strikes affecting Foundry.
Lower Acquired Margins in Application Software
For the first quarter of 2025, margins in the Application Software segment are expected to be down year-over-year due to lower acquired margins from Transact Campus.
Company Guidance
During the call, Roper Technologies provided guidance on various financial metrics for 2025. The company anticipates a total revenue growth of over 10%, with organic revenue growth expected in the 6% to 7% range. Roper guided adjusted diluted earnings per share (DEPS) to be between $19.75 and $20. The company also highlighted its robust cash flow performance, achieving a 16% growth in free cash flow for 2024, reaching over $2 billion, with margins at 32%. Additionally, Roper discussed its strong M&A capacity, boasting over $5 billion of available acquisition firepower. The company expects to leverage this capacity as the M&A market becomes more attractive, driven by increasing pressure on private equity firms to provide liquidity to their limited partners.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.