Rockwell Automation, Inc.

(New York Stock Exchange)
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Slightly Bullish +25

Morgan Stanley cuts target for Rockwell Automation stock to USD 520.00

Analyst downgrade Earnings report Guidance raised AI-generated analysis

πŸ“‰ Morgan Stanley cut its price target for Rockwell Automation from USD 545.00 to USD 520.00 on October 16, 2026.

πŸ“ˆ Third-quarter fiscal 2026 sales reached USD 2.31 billion, marking a 7.9% increase year over year.

πŸ’° Diluted earnings per share were reported at USD 3.65 with adjusted EPS of USD 3.49 for the quarter.

πŸ’΅ Operating cash flow totaled USD 724 million while free cash flow reached USD 654 million in Q3.

πŸš€ Fiscal 2026 guidance was raised to organic sales growth of 7.5% to 9.5% and adjusted EPS of USD 13.00 to USD 13.30.

πŸ“Š The company trades at a P/E ratio of 41.13 with a market capitalization of USD 48.7 billion as of late October 2026.

βš–οΈ Analysts note the valuation remains above peers Eaton and Emerson Electric despite improved growth metrics.

Bullish Signals
  • Rockwell Automation reported third-quarter sales of USD 2.31 billion, a 7.9% year-over-year increase driven by strong operational performance.
  • The company generated significant cash flow with USD 724 million in operating cash and USD 654 million in free cash for the quarter.
  • Management raised fiscal 2026 guidance to organic sales growth of 7.5% to 9.5% and adjusted EPS between USD 13.00 and USD 13.30.
Risk Factors
  • Morgan Stanley reduced its price target from USD 545.00 to USD 520.00, citing a valuation that remains high relative to peers.
  • The stock trades at a P/E ratio of 41.13, which is notably above the P/E ratios of comparable companies like Eaton and Emerson Electric.
Full Analysis
Morgan Stanley has lowered its price target for Rockwell Automation from USD 545.00 to USD 520.00, citing a valuation that remains elevated relative to peers like Eaton and Emerson Electric despite recent operational strength. The analyst firm's revised outlook highlights the central tension between the company's improved growth metrics and its high multiple. Rockwell Automation reported robust third-quarter fiscal 2026 sales of USD 2.31 billion, representing a 7.9% year-over-year increase compared to USD 2.14 billion in the prior period. Diluted earnings per share reached USD 3.65, while adjusted EPS stood at USD 3.49, reflecting solid operational performance during the quarter ending June 30, 2026. The company demonstrated strong cash generation with operating cash flow of USD 724 million and free cash flow of USD 654 million for the quarter. Consequently, management raised its fiscal 2026 guidance to report organic sales growth between 7.5% and 9.5%, along with adjusted EPS guidance set between USD 13.00 and USD 13.30.