Roper Technologies

Methodology

Roper Technologies' diversified software and technology businesses generate highly predictable recurring revenue from niche vertical market applications. Subscription models and customer stickiness create exceptional earnings visibility. The calculation works well for this serial acquirer with consistent compounding from high-quality recurring revenue software assets.

Methodology

Roper consistently commands premium PEG ratios reflecting exceptional business quality, recurring revenue characteristics, and disciplined acquisition strategy in niche software markets. While expensive on absolute terms, the asset-light model and compounding consistency justify valuations. Compare to Roper's historical range and other serial acquirers rather than traditional industrials.

Methodology

Roper offers a modest dividend as management prioritizes acquisitions in vertical market software over aggressive payout increases. The small dividend adds minimal value compared to capital appreciation from compounding. For Roper, acquisition execution and organic growth in software portfolios matter far more than current yield.