By Rob Otman
Roper Technologies (NYSE: ROP) is a $29 billion company today. Investors that bought shares one year ago are sitting on a 34.35% total return. That’s above the S&P 500’s return of 15.85%.
Roper Technologies stock is beating the market, and it reports earnings soon. But does that make it a good buy today? To answer this question we’ve turned to the Investment U Stock Grader. Our research team built this system to diagnose the financial health of a company.
Our system looks at six key metrics…
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✓ Earnings-per-Share (EPS) Growth: Roper Technologies reported a recent EPS growth rate of 141.9%. That’s above the industrial conglomerates industry average of 47.42%. That’s a great sign. Roper Technologies’ earnings growth is outpacing competitors.
✗ Price-to-Earnings (P/E): The average price-to-earnings ratio of the industrial conglomerates industry is 19.04. And Roper Technologies’ ratio comes in at 35.96. Its valuation looks expensive compared to many of its competitors.
✓ Debt-to-Equity: The debt-to-equity ratio for Roper Technologies stock is 75.11%. That’s below the industrial conglomerates industry average of 79.71%. That’s a good sign. Roper Technologies’ debt levels are not out of control.
✓ Free Cash Flow per Share Growth: Roper Technologies has increased its FCF per share over the last year relative to its competitors. That’s good for investors. In general, if a company is growing its FCF, it will be able to pay down debt, buy back stock, pay out more in dividends and/or invest money back into the business to help boost growth.
✓ Profit Margins: The profit margin of Roper Technologies comes in at 36.19% today. And generally, the higher, the better. We also like to see this ratio above competitors. Roper Technologies’ profit margin is above the industrial conglomerates average of 13.28%. So that’s a positive indicator for investors.
✓ Return on Equity: Return on equity gives us a look at the amount of net income returned to shareholders. The ROE for Roper Technologies is 15.36% and that’s above its industry average ROE of 12.24%.
Roper Technologies stock passes five of our six key metrics today. That’s why our Investment U Stock Grader gives it a Strong Buy.
Please note that our fundamental factor checklist is just the first step in performing your own due diligence. There are many other factors you should consider before investing. That’s why The Oxford Club offers more than a dozen newsletters and trading advisories all aimed at helping investors grow and maintain their wealth.
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Source:: Investment You
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