Yahoo Finance Roper (ROP) Stock Gains 7.9% in a Year: Will the Rally Last?
Roper Technologies ROP has gained approximately 8% in the past year against the industry’s 0.6% decrease. The upside can be linked to strong customer demand and a robust pipeline of orders.
Catalysts Behind the Share Price Increase
Roper’s Application Software segment is benefiting from strength across its Deltek, Vertafore, Aderant and CliniSys businesses. Strength across enterprise-class customers, government contracting and private sector solutions is aiding Deltek, while record bookings and the adoption of SaaS models are key catalysts to Aderant’s growth.
The strong performance of freight-matching businesses is aiding the Network Software segment. Strength across the Foundry and iPipeline businesses is driving the unit’s growth. Strong bookings, retention and customer expansions are supporting iPipeline business’ performance.
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Strong momentum across the Neptune business, which is due to increased demand for residential and commercial ultrasonic static meters, is a key growth driver for the Tech-enabled Products segment. Strength across Verathon and Northern Digital business also supports the growth of the Tech-enabled Products unit.
Roper’s measures to expand market presence, solidify customer base and enhance product offerings through acquisitions hold promise. The company acquired Frontline Education in October 2022. The acquisition builds on Roper’s Horizon software business (which it acquired in 2008), expanding its presence in the K-12 education market.
Roper’s commitment to rewarding its shareholders through dividend payments and share buybacks also drove its shares. In the first quarter of 2023, the company generated a free cash flow of $445 million, up 4% year over year. In 2022, ROP rewarded its shareholders with dividend payments of $262.3 million, up 11% year over year. Also, in the first quarter 2023, ROP paid dividends of $72.3 million, up 10.7% year over year. In November 2022, the company hiked its dividend by 10%.
Will the Trend Last?
In 2023, ROP’s top line is likely to benefit from its Vertafore business, driven by the recent acquisition of MGA Systems. In the quarters ahead, Roper is also expected to gain from the rising manufacturing productivity at Neptune and improvement in the medical product businesses of the Tech-enabled Products unit.
Zacks Rank & Other Stocks to Consider
ROP currently carries a Zacks Rank #2 (Buy). Some other top-ranked companies include Ingersoll Rand Inc. IR, Alamo Group Inc. ALG and Axon Enterprise AXON.
Ingersoll Rand presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks.
IR delivered a trailing four-quarter earnings surprise of 12.6%, on average. In the past 60 days, estimates for Ingersoll Rand’s 2023 earnings have increased 7.5%. The stock has improved 24.4% in the past year.
Alamo currently sports a Zacks Rank of 1. ALG delivered a trailing four-quarter earnings surprise of 17.7%, on average.
In the past 60 days, estimates for Alamo’s 2023 earnings have increased 12.7%. The stock has gained 48.6% in the past year.
Axon sports a Zacks Rank of 1, at present. The company has a trailing four-quarter earnings surprise of 44.4%, on average.
In the past 60 days, estimates for Axon’s 2023 earnings have increased 13%. The stock has rallied 88.2% in the past year.
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Roper Technologies, Inc. (ROP) : Free Stock Analysis Report
Ingersoll Rand Inc. (IR) : Free Stock Analysis Report
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