Roper Gets Ready to Report Fourth Quarter Earnings: What’s in the Cards?

Roper Technologies, Inc. ROP is expected to report fourth-quarter 2024 results on January 30, before the market opens.

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The Zacks Consensus Estimate for Roper’s fourth-quarter earnings has increased 0.9% over the past 60 days. The company has an impressive history of earnings surprises. It has outperformed consensus expectations in each of the previous four quarters, with an average surprise of 1.2%.

The Zacks Consensus Estimate for the company’s revenue is pegged at $1.83 billion, indicating growth of 13.6% from the prior-year quarter’s figure. The consensus estimate for adjusted earnings is set at $4.76 per share, indicating growth of 8.9% from the prior-year quarter.

Let’s take a look at how things went for Roper this earnings season.

The performance of ROP’s Application Software segment in the fourth quarter is expected to have benefited from the strength of the Deltek, Strata, PowerPlan and Aderant businesses. The growing adoption of Software as a Service (SaaS) solutions and continued GenAI innovation have likely been key catalysts for Aderant’s business growth. Deltek’s business is likely to have benefited from solid demand for SaaS solutions in the GovCon sectors and the expansion of GenAI functionality.

The Strata business is expected to have performed well, driven by strong demand for its leading decision support and financial planning solutions in the healthcare market. Strong customer retention and adoption of new SaaS solutions are expected to have boosted PowerPlan business. We expect the segment’s revenues to increase 18% year-over-year to $1 billion.

Roper’s network software segment is expected to have benefited from strong momentum in alternate site healthcare operations, driven by increased demand for software solutions at MHA. Our estimate for Network Software segment revenue is set at $376.1 million, indicating a year-over-year increase of 3.6%.

The Technology Enabled Products segment’s performance is expected to be driven by the strength of the Neptune business due to continued demand for ultrasonic meters and increasing adoption of meter data management software. Solid performance from the Verathon business, driven by the strength of its single-use BFlex and GlideScope offerings and continued demand for BladderScan, likely helped the segment this quarter. We expect segment revenues to increase 9.8% to $438.1 million from last year’s figure.

The synergistic gains from the company’s acquisitions are expected to have boosted revenues. Roper acquired Procare Solutions in February 2024, boosting its software offering in the education sector. Furthermore, the acquisition of Syntellis Performance Solutions in August 2023 expanded its SaaS solutions portfolio.

We expect the company’s total revenue to reach $1.8 billion, up 12.8% year over year. Adjusted earnings are expected to be $4.70 per share, up 7.5% from the prior year quarter.

However, rising operating expenses, due to higher costs associated with the depreciation of acquired assets and higher selling, general and administrative expenses, have likely impacted ROP’s margin performance. We expect general and administrative expenses for the fourth quarter to be $731.7 million, indicating an increase of 10.5% year over year.

Roper has significant exposure to overseas markets. Given the company’s extensive international operations, foreign currency headwinds are likely to have hit margins and profitability.

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