Rockwell Automation Surged 10% in January as Growth Picked Up Steam – Motley Fool

Could domestic manufacturing equipment become a hot business if trade barriers suddenly pop up around the world? What happened

Shares of Rockwell Automation (NYSE:ROK) jumped 10.1% in January, according to data provided by S&P Global Market Intelligence, after an impressive earnings report and improved guidance gave investors a bullish outlook on the future.

Fiscal first-quarter 2017 revenue was up 4.5% from a year ago to $1.49 billion, and net income jumped from $185.5 million a year ago to $214.7 million, or $1.65 per share. But it was really full-year guidance that got investors' attention. Management increased growth guidance by a full percentage point, and now expects reported and organic growth of 1% to 5%. On the bottom line, guidance was increased by $0.10 to $5.56 to $5.96 per share.

Image source: Getty Images.

Automation equipment is going to be a key growth driver of efficiency in the economy, and may be even more necessary if trade barriers start going up around the world. When financials start matching up with that bullish investment thesis, it could be a big driver of stocks like Rockwell long-term. I don't think this will suddenly be a double-digit growth company in the near future, but with these tailwinds and a 2% dividend yield, I think Rockwell Automation is a well positioned stock for the economic trends of the next decade.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Travis Hoium has been writing for fool.com since July 2010 and covers the solar industry, renewable energy, and gaming stocks among other things.

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Rockwell Automation Surged 10% in January as Growth Picked Up Steam - Motley Fool