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Valuation · EV/EBITDA model

Is Roper Technologies (ROP) stock undervalued?

Brief Equity's quick EV/EBITDA model of Roper Technologies, dated October 24, 2026, values the shares at about $544 for 2028, against a price of $438.14 that day. On those assumptions Roper looks cheap, especially for a business of its quality, with a return of about 24%. The view depends on one condition: that customers buy Roper's new AI tools on top of the software they use now, rather than building their own.

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By The Brief Equity Team · Model dated · Published

Brief Equity valuation model card for Roper Technologies (ROP): an EV/EBITDA exit model with projected revenue, EBITDA, margins and cash flow to 2028, and a target for 2028.
The Roper Technologies model card as captured on October 24, 2026: the target, the share price that day and the projection behind them.

The model's assumptions for Roper Technologies

Roper Technologies' fiscal year is the calendar year. The figures below come from a quick model of Roper, built on a few stated assumptions and projected to 2028, with analyst consensus revenue beside the model's revenue for the same three years.

Roper Technologies: model assumptions, 2026 to 2028 (revenue and EBITDA in $ billions)
202620272028
Revenue, model8.579.179.86
Revenue growth, model8.5%7.0%7.5%
EBITDA, model3.373.674.02
EBITDA margin, model39.3%40.0%40.8%
Roper Technologies: model revenue and analyst consensus revenue, 2026 to 2028 ($ billions)
202620272028
Revenue, model8.579.179.86
Revenue, analyst consensus8.579.099.61

Why Roper Technologies looks undervalued

Roper Technologies looks cheap at a share price in the 430s, especially for a business of its quality, even after its shares rose almost 10% in a single session on its third-quarter 2026 results.

Roper's share price decline began after its fourth-quarter 2025 call on January 27, 2026, when its guidance for 2026 came in below analysts' estimates, at the same time as a broad sell-off in software stocks began. The shares recovered to $429.60 on September 3, 2026, then fell to $347.45 by September 29.

Roper owns 29 businesses, most of them in software, and 18 of its 21 software businesses operate in regulated markets. Gross retention in its enterprise software is consistently in the mid-90s, organic recurring revenue in its two software segments grew 8% in the third quarter of 2026, and the company expects free cash flow of 30% or more of revenue for 2026.

Brief Equity's model of Roper is a quick one. It has revenue growing 8.5% in 2026, in line with the company's guidance of total growth above 8%, then 7.0% in 2027 and 7.5% in 2028, against analysts' expected growth of 6.7% a year from 2025 to 2028. With the EBITDA margin rising from 39.3% to 40.8%, valuing the company at 14 times EBITDA in 2028 gives about $544 a share, about 24% above the price on the model's date.

Roper's price of $438.14 implies revenue falling 4.6% a year when the model's other assumptions are held constant.

The model's growth above the consensus in 2027 and 2028 rests on Roper's AI tools, which management aims to sell in addition to the software customers already pay for, rather than in its place. The chief executive said on the third-quarter 2026 call that about 75% of CentralReach's bookings and about 25% of Aderant's are AI or AI-related.

Roper's case therefore depends on its customers buying the AI tools on top of its existing software instead of building their own.

What has to be true, and what would break it

Roper Technologies looks cheap on this model only while a few things hold, and the view fails if they do not.

What has to be true

  • Roper's customers buy its AI tools in addition to the software they already use.
  • Revenue grows 7.0% to 8.5% a year through 2028.
  • The EBITDA margin rises from 39.3% in 2026 to 40.8% in 2028.
  • Investors pay at least 14 times EBITDA for the company in 2028.

What would break it

  • Customers use AI to build applications in-house instead of buying them, the fear behind the 2026 sell-off in software stocks.
  • Bookings keep slowing, as they did between the second and third quarters of 2026.
  • Spending on AI grows faster than the revenue the AI tools bring in.

The parts of Roper Technologies's business

Roper Technologies reports three segments. Application Software is the largest, and most of the revenue growth in 2025 came from it, much of that growth from acquisitions.

Roper Technologies by part, 2025 against 2024
Share of revenueShare of revenue growth
Application Software56.7%71.2%
Network Software20.3%14.5%
Technology Enabled Products23.0%14.3%

Roper Technologies beside its peers

Roper Technologies is compared here with seven companies, chosen to cover its niche software businesses, its data networks, its water meters and its way of buying businesses to keep.

  • TYL: Software for governments and schools, against Frontline
  • GWRE: Insurance software, against Vertafore
  • VEEV: Software for one regulated industry, against Strata, Clinisys and CentralReach
  • BSY: Project and asset software for engineers and utilities, against Deltek and PowerPlan
  • VRSK: Data networks sold by subscription, against DAT, iPipeline and ConstructConnect
  • BMI: Water meters, against Neptune
  • AME: A serial buyer of niche businesses that it keeps, as Roper is
Peer comparison table for Roper Technologies (ROP) and seven peers, with each company's valuation multiples, revenue growth and margin.
Roper Technologies beside its seven peers on trailing multiples, as captured on October 24, 2026.

How the estimate moves with its assumptions

Roper Technologies' estimate depends on its assumptions, and the two pictures below show how far it moves when they change. The first varies two assumptions at a time. The second runs the model many times with growth, margin and the exit multiple drawn at random.

Sensitivity grids for Roper Technologies (ROP): the value per share as revenue growth, EBITDA margin, the exit multiple, the discount rate and terminal growth change.
How the Roper Technologies estimate changes when two assumptions move together. The exit grids are discounted to today's dollars.
Monte Carlo distribution of per-share outcomes for Roper Technologies (ROP), with the share price on the model's date and the median outcome marked.
The spread of outcomes for Roper Technologies when growth, margin and the exit multiple vary at random.

Questions about Roper Technologies

These questions about Roper Technologies (ROP) are answered from the documents listed under Sources.

How much of Roper's 2025 revenue growth was organic?
Roper's net revenues rose 12.3% to $7,902.5 million in 2025, of which 5.4 points were organic and 6.7 points came from acquisitions.
How many shares did Roper buy back in 2026?
In the six months ended June 30, 2026, Roper repurchased 7.865 million shares for $2,724.1 million, an average price of $346.34 a share.
What is Roper's earnings guidance for 2026?
In its third-quarter 2026 results Roper raised its full-year 2026 adjusted DEPS guidance to $22.35 to $22.40, from $22.15 to $22.30.
How much debt does Roper have?
At September 30, 2026 Roper reported $1,415.1 million of current debt and $8,304.6 million of long-term debt, against cash and cash equivalents of $311.0 million.

Sources

The quotations and facts about Roper Technologies (ROP) on this page rest on the documents below.

About this page

Brief Equity and its team hold no position in Roper Technologies (ROP) as of October 24, 2026.

This page is research, not investment advice. It describes one model and the assumptions behind it, and market data is delayed. Read how these models are built and our editorial policy.

Related guides: EV/EBITDA explained, What is enterprise value (EV), What is an economic moat.

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