Our 'BBB' rating on Roper Industries Inc. is derived from: Our anchor of 'bbb+', based on our "satisfactory" business risk and "modest" financial risk profile assessments for the company. Our assessment of Roper's "negative" financial policy, which lowered the ratings by one notch, resulting in the 'BBB' corporate credit rating. Broad diversification by product, end market, customer, and region; Exposure to cyclical and competitive industries but with strong leadership positions (generally No. 1 or 2) in addressable markets; Low capital intensity, enabling consistent free cash flow; Good operating margins, with adjusted EBITDA margin of about 33%; Exposure to cyclical industrial markets; and Acquisition strategy adds some integration risk. Consistent free operating cash flow generation well in excess of $600 million
