Rockwell Automation & Accenture To Offer Digital Solutions

Rockwell Automation, Inc. (NYSE:ROK) has collaborated with Accenture Plc’s (NYSE:ACN) Industry X.0 to develop a digital offering for industrial clients, in a bid to transform their entire connected enterprise with supply-chain optimization. The partnership will assist clients to leverage the Industrial Internet of Things (IIoT) while providing customers with a single provider of digital solutions.

Notably, the collaboration will help Rockwell reduce risk, complexity and achieve better results with comprehensive enterprise-wide expertise. In fact, Rockwell will provide industrial automation technology, including its FactoryTalk InnovationSuite IIoT software and solutions, in addition to network services, application development and operational-technology security. This apart, Accenture will provide enterprise business and technical capabilities, that include analytics, consulting, application development, change management and systems integration.

Encouraging initial-industry feedback regarding the digital offerings has led both companies to develop solutions which create an industrial value chain. The alliance has already yielded a supply-chain management prototype designed to deliver cost savings to suppliers and an ability to track product movements.

In order to implement and enhance the quality of digital initiatives, the new Rockwell Automation Digital Partner Program connects forces with market leaders like Accenture, Microsoft Corporation (NASDAQ:MSFT) , PTC, ANSYS, Inc. (NASDAQ:ANSS) and EPLAN. These days, businesses are digitally transforming their operations, which require partner networks to simplify technology deployments and achieve higher productivity. The program assists businesses to consult with industry advisors on digital initiatives and IIoT concepts that can improve their efficiency.

In 2018, the company acquired PTC, a leader in IIoT and augmented reality. Further, Rockwell’s partnership with PTC and the creation of FactoryTalk InnovationSuite have simplified the businesses-connection process with growing number of smart technologies in their operations. Rockwell is focused on integrating technologies and services to help customers transform their business with tailor-made needs.

The company recently delivered better-than-expected fourth-quarter fiscal 2019 results, wherein the top and bottom lines, both, outpaced the respective Zacks Consensus Estimates. Results reflected continued strength in oil and gas, mining, and life sciences, as well as solid performance in automotive, and food and beverage.

The company anticipates fiscal 2020 earnings per share in the band of $8.70-$9.10. The mid-point of the guided range indicates 3% year-over-year growth. Reported sales growth is expected in the range of 2% to 5%. Sales for fiscal 2020 are estimated at around $7 billion. However, results will likely be affected by trade-war tensions, slowdown in the U.S manufacturing activity and weakness in few end markets.

Nevertheless, Rockwell is poised to benefit from its focus on broadening the company’s portfolio of hardware and software products, solutions and services. Further, significant investments to globalize manufacturing, product development and customer-facing resources will fuel growth. These apart, the company’s acquisition pipeline remains robust.

Rockwell Automation has also entered into a joint-venture (JV) agreement with Schlumberger (NYSE:SLB) to form Sensia — the first fully-integrated digital oilfield automation solutions provider. Sensia will operate as an independent entity, with Rockwell Automation owning 53% and Schlumberger owning the balance. The company is well poised to benefit from this JV in fiscal 2020.

Share Price Performance

Over the past year, Rockwell Automation’s shares have gained 16% outperforming the industry’s growth of 5.6%.

Rockwell Automation currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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