UPDATE 2-Roper Industries Q1 profit in line, ups FY EPS view

* Q1 adj EPS $0.65

* Revenue up 6 pct

* Raises FY EPS view to $2.95-$3.10

* Sees Q2 EPS $0.71-$0.75

* Expects to complete additional acquisitions in 2010
(Adds details, conference call and analysts comments, updates
share movement)

By Fareha Khan

BANGALORE, April 26 (BestGrowthStock) – Diversified manufacturer
Roper Industries Inc (ROP.N: ) posted a quarterly profit in line
with market estimates and raised its full-year earnings outlook
on an increase in orders.

However, shares of the Sarasota, Florida-based company fell
as much as 5 percent, before paring some losses to trade down 4
percent at $61.18 Monday on the New York Stock Exchange.

The company’s shares have risen 54 percent in the past one
year, compared with a nearly 60 percent in the Dow Jones U.S.
Diversified Industrial Index (.DJUSID: ).

Ingalls and Snyder analyst Alexander Blanton said Roper’s
stock may have fallen due to disappointment among investors who
bought its shares expecting it to beat estimates.

Several industrial companies, including Dover Corp (DOV.N: )
last week, reported earnings higher than expected, and maybe
people bought shares of Roper thinking the same would happen,
but it did not, he said.

“The stock had a huge run-up on Thursday and Friday, and
now its pulled back a little,” Blanton added.

On a conference call with analysts, Roper said it sees its
second half to be stronger than the first.

The company forecast full-year earnings of $2.95 to $3.10 a
share, up from its prior view of $2.83 to $3.03 a share.

For the current quarter, the company projected earnings of
71 cents to 75 cents a share.

Analysts on average were expecting earnings of $3.01 a
share and 73 cents a share for the full year and the second
quarter, respectively, according to Thomson Reuters I/B/E/S.

Orders for the company, which provides engineered products
for water, energy and healthcare markets, rose 20 percent to
$567.2 million. Orders for the company’s energy systems and
controls segment jumped 18 percent to $115.3 million.

Sales at the company’s scientific and industrial imaging
segment rose 54 percent at $130.2 million, the company said.

“As the company has some of the highest margins in the
industrial space and as the top line accelerates, contribution
margins should be quite robust,” Janney Montgomery Scott
analyst James Lucas wrote in a note.

For the quarter, operating cash flow jumped 88 percent to a
record $95 million, the company said.

Roper has a growth oriented product mix that is diversified
into businesses, which have good growth prospects and high cash
flow, Blanton said.

Roper Industries, which acquired the Heartscape medical
product line in the quarter, said it expects to complete
additional acquisitions during the year.

“Roper has plenty of financial wherewithal to pursue
acquisitions and we would expect deals to transpire before
year’s end,” said Lucas.

The company said net debt was down at $927 million, and
sees capital expenditures ranging about $25 million.

Roper is better positioned than it was five years ago,
Ingalls and Snyder’s Blanton said, and added that over the next
five years, the company will continue to see good growth as the
current management has made attractive acquisitions.


For the first quarter, the company reported net income of
$59.7 million, or 62 cents a share, compared with $51.6
million, or 56 cents a share, a year ago.

Excluding items, it earned 65 cents a share.

Revenue rose 6 percent to $534.4 million for the quarter.

Analysts on average were expecting the company to earn 65
cents a share, before special items, on revenue of $547.6

Investing Analysis

(Reporting by Fareha Khan in Bangalore; Editing by Anne
Pallivathuckal, Aradhana Aravindan)

UPDATE 2-Roper Industries Q1 profit in line, ups FY EPS view