AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Specific integration and proprietary-data mechanisms are asserted, but their competitive effect is not sufficiently demonstrated to establish a moat.
durability · — · Recurring revenue and several periods of organic growth do not establish the duration of competitive protection.
customer dependency · — · Renewal activity demonstrates recurring demand, but customer dependence and costly replacement remain unverified.
erosion resilience · — · AI commercialization is disclosed, but resilience against substitution is not demonstrated. AI risk disclosures describe possibilities, not realized displacement.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · — · No observed pricing outcome is isolated. Possible competitive price adjustments and supplier-cost pass-through difficulty cannot establish actual customer pricing.
retention · 2/4 · SaaS and support renewal activity, recognized deferred revenue and broad organic growth support repeat demand indirectly. Missing renewal rates and cohort data prevent a strong portfolio-wide retention conclusion.
margin resilience · 2/4 · Performance is mixed: first-half 2026 consolidated gross margin improved, but operating margin declined; Application Software gained operating leverage while products suffered mix and input-cost pressure. This assesses observed resilience without inferring a moat or price increases.
contractual freedom · 1/4 · Disclosed government rights to terminate or modify contracts without penalty establish a material limitation on contractual control in that business. Its portfolio weight and broader repricing rights are unavailable.
Predictability84
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 75.00
- Revenue growth volatility (pp)
- 9.04
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 7.97
Financial strength33
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 60.99
- netDebtEbitGrade
- 19.45
- interestCoverageGrade
- 53.44
- currentRatioGrade
- 0.00
- Debt / FCF (x)
- 3.73
- Net debt / operating income (x)
- 4.03
- Interest coverage (x)
- 6.88
- Current ratio (x)
- 0.52
Capital allocation80
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 7.93
- 3-year average dilution (%)
- 0.47
- 3-year average SBC / revenue (%)
- 2.06
- cashConversionGrade
- 100.00
Management69
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Substantial cash generation supports investment capacity, but first-half 2026 repurchases of roughly $2.73 billion exceeded $1.06 billion of operating cash flow alongside $2.0 billion of net revolver borrowing and rising interest costs. Acquisition returns remain unverified. Overpayment allegations and the board's rebuttal are not treated as proof.
incentive alignment · 3/4 · Actual 2025 pay was predominantly tied to stock price and performance; disclosed equity arrangements include three-year service requirements, with anti-hedging, anti-pledging and clawback protections. Rising stock compensation and missing ownership and target details limit the assessment; plan approval is not treated as vesting.
execution · 3/4 · Repeated organic growth, continuing cash generation and growing backlog demonstrate operating execution, assessed from aggregate operating evidence rather than customer-level outcomes. Margin pressure and higher interest expense temper the result; acquisition-specific returns and AI benefits remain unproven.
governance · 3/4 · An independent chair, independent directors other than the CEO, independent committees, annual elections and an operative clawback provide strong disclosed safeguards. These actual arrangements support the grade without proving exceptional oversight effectiveness.
Evidence
The Roper vertical market software businesses occupy a fundamentally different and highly defensible competitive position: they sit at the intersection of proprietary domain data, specialized regulatory and workflow expertise, and deep customer integration in markets where switching costs are high and generic solutions are inadequate.
Board response to shareholder proposal: asserted workflow integration and switching costs · Filed 07/04/2026
The change in our net contract assets/(liabilities) from December 31, 2025 to June 30, 2026 was primarily due to the timing of payments and invoicing related to SaaS and PCS renewals, driven predominantly by the SaaS renewal cycle of our Frontline business which primarily occurs in the third quarter.
Revenue recognition: SaaS and PCS renewal cycle · Filed 31/07/2026
Revenue recognized that was included in the deferred revenue balance on December 31, 2025 and 2024 was $573.5 and $531.6 for the three months ended June 30, 2026 and 2025, respectively, and $1,422.8 and $1,306.0 for the six months ended June 30, 2026 and 2025, respectively.
Revenue recognition: revenue recognized from opening deferred revenue · Filed 31/07/2026
The growth of 4.8% in organic revenues was broad-based across the segment, led by our application software businesses serving the legal, project-based private sector, higher education, and property and casualty insurance markets.
Results of operations: Application Software organic revenue growth · Filed 31/07/2026
In many situations, government entities can unilaterally terminate or modify existing contracts without cause and without penalty to the government agency, and government contracts may be subject to specialized compliance obligations, audits, investigations, and bid processes that can delay awards and increase costs.
Risk factors: government contract termination and modification rights · Filed 24/02/2026
New AI offerings may disrupt our offerings or transform workforce needs and may negatively impact demand for our offerings, or our competitors may be able to incorporate AI into their offerings more efficiently or successfully than we are able to.
Competition risk: potential AI disruption and demand substitution · Filed 31/07/2026
The Company’s businesses hold leadership positions in specialized end markets including education, government contracting, healthcare, legal technology, insurance technology, and water infrastructure, where the data required to train effective AI models is proprietary, fragmented, and not available to horizontal competitors.
Board response to shareholder proposal: asserted proprietary data barriers · Filed 07/04/2026
Intellectual Property In addition to trade secrets, including unpatented know-how and other intellectual property like software source code, we own or license the rights under numerous patents, trademarks, trade dress, and copyrights relating to certain of our products and businesses.
Business: intellectual property ownership and licensing · Filed 24/02/2026
The Company has already made meaningful progress in deploying AI capabilities across the portfolio, with all of its software businesses actively developing and commercializing AI-based products and features.
Board response to shareholder proposal: AI development and commercialization · Filed 07/04/2026
The rapid pace of AI advancement may make it difficult to maintain competitive advantages, and AI capabilities could become commoditized, reducing our ability to significantly differentiate our offerings.
AI risk factors: potential commoditization · Filed 31/07/2026
Under this methodology the fair value is determined based on the estimated future after-tax cash flows arising from the acquired customer relationships over their estimated useful lives after considering customer attrition and contributory asset charges.
Critical accounting estimates: acquired customer relationship valuation · Filed 24/02/2026
As AI becomes more central to our offerings, our exposure to pricing changes from these providers increases, and we may not be able to pass such cost increases on to our customers.
AI supplier risk: possible inability to pass through cost increases · Filed 31/07/2026
Moreover, competition may require us to adjust prices to stay competitive.
Competition risk: possible competitive price adjustments · Filed 24/02/2025
The following table sets forth selected information for the periods indicated: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net revenues: Application Software $ 1,180.8 $ 1,094.9 $ 2,372.3 $ 2,163.1 Network Software 430.9 385.4 858.5 761.3 Technology Enabled Products 497.2 463.3 973.4 902.0 Total $ 2,108.9 $ 1,943.6 $ 4,204.2 $ 3,826.4 Gross margin: Application Software 69.8 % 68.8 % 69.4 % 68.1 % Network Software 84.3 % 83.2 % 84.3 % 83.6 % Technology Enabled Products 56.9 % 58.6 % 56.9 % 58.6 % Total 69.7 % 69.2 % 69.5 % 69.0 % Selling, general and administrative expenses: Application Software (42.3) % (41.9) % (42.3) % (41.7) % Network Software (43.4) % (39.3) % (43.5) % (39.5) % Technology Enabled Products (23.6) % (23.1) % (24.0) % (23.4) % Total (38.1) % (36.9) % (38.3) % (37.0) % Segment operating margin: Application Software 27.4 % 26.9 % 27.1 % 26.4 % Network Software 41.0 % 43.9 % 40.8 % 44.1 % Technology Enabled Products 33.3 % 35.4 % 32.9 % 35.2 % Total 31.6 % 32.3 % 31.2 % 32.0 % Corporate administrative expenses * (3.9) % (4.1) % (3.8) % (3.9) % Income from operations 27.7 % 28.2 % 27.5 % 28.1 % Interest expense, net (5.3) % (4.1) % (5.0) % (3.7) % Equity investment gain (loss), net 39.6 % 0.9 % 23.8 % (0.7) % Other expense, net — % — % (0.1) % — % Earnings before income taxes 62.0 % 25.0 % 46.2 % 23.6 % Income taxes (6.6) % (5.5) % (6.3) % (5.1) % Net earnings 55.4 % 19.5 % 39.9 % 18.5 % * Includes unallocated corporate general and administrative expenses and enterprise-wide stock-based compensation.
Results of operations: comparative segment and consolidated margins · Filed 31/07/2026
Gross margin decreased to 56.9% in the six months ended June 30, 2026 as compared to 58.6% in the six months ended June 30, 2025 due primarily to revenue mix within our medical products businesses weighted more towards consumables and input cost pressures at our water meter technology business.
Technology Enabled Products: realized mix and input-cost margin pressure · Filed 31/07/2026
Gross margin increased to 69.8% in the second quarter of 2026 as compared to 68.8% in the second quarter of 2025 due primarily to improved leverage on higher organic revenues.
Application Software: gross margin improvement from operating leverage · Filed 31/07/2026
5 Roper Technologies, Inc. Condensed Consolidated Statements of Cash Flows (unaudited) (Amounts in millions) Six months ended June 30, 2026 2025 Cash flows from operating activities: Net earnings $ 1,677.4 $ 709.4 Adjustments to reconcile net earnings to cash flows from operating activities: Depreciation and amortization of property, plant and equipment 20.1 19.6 Amortization of intangible assets 440.9 417.2 Amortization of deferred financing costs 6.3 5.5 Non-cash stock compensation 108.2 82.7 Equity investment (gain) loss, net (1,002.5) 27.8 Income tax provision 265.6 193.9 Changes in operating assets and liabilities, net of acquired businesses: Accounts receivable 71.0 37.4 Unbilled receivables (30.8) (9.7) Inventories (4.9) (9.6) Prepaid expenses and other current assets (23.3) (22.9) Accounts payable 24.4 7.0 Other accrued liabilities (93.9) (115.4) Deferred revenue (193.6) (132.7) Cash taxes paid for gain on disposal of equity investment — (30.2) Cash income taxes paid, excluding tax associated with gain on disposal of equity investment (190.2) (233.7) Other, net (13.1) (13.5) Cash provided by operating activities 1,061.6 932.8 Cash flows from (used in) investing activities: Acquisitions of businesses, net of cash acquired (27.5) (2,005.2) Capital expenditures (25.3) (26.0) Capitalized software expenditures (30.9) (26.8) Distributions from equity investment 6.7 5.1 Cash receipts on beneficial interest in sold receivables 4.5 — Other, net 0.2 1.6 Cash used in investing activities (72.3) (2,051.3) Cash flows from (used in) financing activities: Borrowings under revolving credit facility, net 2,000.0 1,275.0 Debt issuance costs (3.9) — Cash dividends to stockholders (191.4) (177.2) Repurchases of common stock (2,726.7) — Proceeds from (tax withholding payments for) stock-based compensation, net (8.6) 73.8 Treasury stock sales under employee stock purchase plan (“ESPP”) 12.7 12.5 Other, net 12.8 (43.9) Cash provided by (used in) financing activities (905.1) 1,140.2 Effect of exchange rate changes on cash (16.7) 32.5 Net increase in cash and cash equivalents 67.5 54.2 Cash and cash equivalents, beginning of period 297.4 188.2 Cash and cash equivalents, end of period $ 364.9 $ 242.4 Non-cash investing and financing activities: Equity consideration for business acquisition $ — $ 7.3 See accompanying notes to Condensed Consolidated Financial Statements.
Six-month cash flow statement: operating cash, investment, borrowing and repurchases · Filed 31/07/2026
Interest expense, net, increased to $210.7 for the six months ended June 30, 2026 as compared to $142.0 for the six months ended June 30, 2025 due primarily to higher average debt balances and a higher weighted-average interest rate on our senior notes.
Results of operations: higher debt balances and interest expense · Filed 31/07/2026
In 2025, we deployed $3.3 billion toward vertical-market software acquisitions—most notably our acquisitions of CentralReach, a leading provider of SaaS and AI-enabled solutions supporting the workflow and administration of applied behavior analysis therapy for autism spectrum disorder and related disabilities care, acquired for $1.85 billion; and Subsplash, a leading provider of AI-enabled SaaS delivering digital engagement, church management, and integrated giving solutions for faith-based organizations, acquired for $800 million.
Board letter: completed 2025 acquisition spending · Filed 07/04/2026
• Pay for Performance. Similar to prior years, in 2025, total direct compensation at target that was at risk and tied to stock price and performance objectives was 96% for the CEO, and 91% on average for our other named executive officers.
Executive compensation: actual 2025 compensation structure · Filed 07/04/2026
Long-Term Stock Incentives Equity compensation is the largest and most important form of pay for our named executive officers as it achieves many of our key compensation objectives: • Tie pay to performance by linking compensation to shareholder value creation and achievement of pre-established and objective performance criteria; • Align named executive officers’ interests with those of shareholders while reinforcing a long-term planning horizon; • Attract named executive officers, particularly those interested in building long-term value for shareholders; and • Retain named executive officers and reward continued service by ensuring the forfeiture of awards prior to satisfaction of three-year service requirements.
Executive compensation: equity incentives and three-year service requirements · Filed 07/04/2026
2026 Proxy Statement Table of Contents COMPENSATION DISCUSSION AND ANALYSIS (CONTINUED) Anti-Hedging and Anti-Pledging Policy We prohibit our named executive officers and directors from engaging in transactions involving derivative instruments with respect to Company securities, and other securities immediately convertible or exchangeable into Company securities, and from pledging shares of Company common stock.
Executive compensation: anti-hedging and anti-pledging policy · Filed 07/04/2026
ii Roper Technologies, Inc. 2026 Proxy Statement Table of Contents PROXY STATEMENT SUMMARY (CONTINUED) Independent Directors: All of our directors, except our CEO, are independent, as is each member of the Audit, Compensation, Executive, and Nominating and Governance Committees.
Corporate governance: director and committee independence · Filed 07/04/2026
One-Year Terms for Directors: All of our directors serve one-year terms.
Corporate governance: annual director terms · Filed 07/04/2026
Independent Chair of the Board: Our Chair of the Board is independent.
Corporate governance: independent board chair · Filed 07/04/2026
The Clawback Policy provides for the prompt recovery (or clawback) of certain excess incentive-based compensation received during an applicable three-year recovery period by current or former executive officers in the event we are required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the securities laws.
Executive compensation: operative clawback policy · Filed 07/04/2026
The amendment to the 2021 Incentive Plan, which was approved by shareholders at the Annual Meeting of Shareholders on May 19, 2026 (the “Annual Meeting”), increased the number of shares available to grant under the Amended Incentive Plan.
Stock-based compensation: May 19, 2026 shareholder approval of plan amendment · Filed 31/07/2026
The components of revenue growth for the year ended December 31, 2025 were as follows: Application Software Network Software Technology Enabled Products Roper Total Revenue Growth 15.9 % 8.5 % 7.3 % 12.3 % Less Impact of: Acquisitions 10.2 4.4 0.8 6.7 Foreign Exchange 0.3 — — 0.2 Organic Revenue Growth 5.4 % 4.1 % 6.5 % 5.4 % In our Application Software segment, net revenues grew 15.9% to $4,483.0 for the year ended December 31, 2025 as compared to $3,868.3 for the year ended December 31, 2024, led by acquisition contribution from Transact and CentralReach.
Results of operations: 2025 acquisition and organic growth decomposition · Filed 24/02/2026
The growth of 5.6% in organic revenues was broad-based across the segment led by our businesses serving the project-based business/government contracting, acute healthcare, property and casualty insurance, and legal markets.
Results of operations: 2024 Application Software organic growth · Filed 24/02/2025
Net cash provided by operating activities increased by 6% to $2,540.3 in 2025 as compared to $2,393.2 in 2024 due primarily to the change in net earnings before non-cash expenses, and a benefit to cash income taxes paid in connection with the repeal of the requirement to capitalize and amortize domestic R&D expenditures under Internal Revenue Code Section 174 (“Section 174”) associated with the enactment of the One Big Beautiful Bill Act (the “OBBBA”).
Liquidity: 2025 operating cash generation and tax benefit · Filed 24/02/2026
Amplifying this last issue, it seems ROP’s been overpaying for many of its mature end-market software companies.
Shareholder proposal: allegation of acquisition overpayment · Filed 07/04/2026
The proposal’s characterization of the Company’s financial performance is misleading because it relies on a six-year analytical period (2018–2024) that spans both the pre- and post-transformation portfolio; blending the financial results of businesses the Company intentionally divested with the performance of the businesses it chose to retain and in which to invest.
Board response: objection to shareholder proposal's analytical comparability · Filed 07/04/2026
While we have experienced disruptions, and our Vertafore business was previously subject to litigation regarding the exposure of data which was dismissed, to date, management has not identified any material impact on the Company from these disruptions.
Cybersecurity risk: disruptions without identified material company impact · Filed 31/07/2026
Backlog increased 11.0% to $3,286.0 at June 30, 2026 as compared to $2,961.3 at June 30, 2025 due primarily to acquisitions and organic growth in our software segments.
Results of operations: year-over-year backlog growth · Filed 31/07/2026
Information regarding the Company’s stock-based compensation expense, included as a component of “Selling, general and administrative expenses” (“SG&A expenses”), is provided in the following table: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Stock-based compensation $ 55.6 $ 43.9 $ 108.2 $ 82.7 Tax benefit recognized in net earnings $ 8.3 $ 6.8 $ 16.3 $ 13.1 The Company accounts for forfeitures of stock-based awards as they occur, with previously recognized compensation reversed in the period in which the awards are forfeited.
Stock-based compensation: realized compensation expense · Filed 31/07/2026
