Regal Rexnord (NYSE:RRX) Posts Quarterly Earnings Results

Regal Rexnord (NYSE:RRX) posted its earnings results on Tuesday. The company reported $2.90 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.65 by $0.25, reports. Regal Rexnord had a return on equity of 10.28% and a net margin of 3.77%. The firm had revenue of $1.59 billion for the quarter, compared to the consensus estimate of $1.56 billion. During the same quarter in the prior year, the business posted $2.51 earnings per share. The business’s quarterly revenue was up 6.1% on a year-over-year basis.

Here are the key takeaways from Regal Rexnord’s conference call:

• Third-quarter results exceeded expectations: organic sales rose 6.1%, adjusted EPS excluding tariff refunds increased 8.4% to $2.72, and free cash flow reached $194 million. Net leverage improved to 2.9x adjusted EBITDA.
• Demand strengthened broadly, with third-quarter daily orders up 5.7% and October orders up 24% enterprise-wide. Commercial HVAC, data center-related products, discrete automation, aerospace and defense, and energy markets were notable areas of strength.
• Operational execution is limiting revenue conversion and margins, particularly in IPS, where plant throughput, material planning, and manufacturing inefficiencies increased past-due backlog. Management expects recovery to take several quarters and has paused most plant consolidations while prioritizing output.
• Regal Rexnord raised its 2026 sales outlook to approximately $6.22 billion and adjusted EPS midpoint to $10.75, while maintaining $600 million of free cash flow guidance. The outlook reflects stronger AMC and PES performance offsetting weaker IPS results.
• Management launched a broad portfolio review using growth, margin, cash generation, returns, and strategic fit criteria, and is exploring a sale of Autonomous Mobile Solutions, which represents a low-single-digit percentage of AMC sales. The company also expects approximately $550 million of E-Pod revenue in 2027, with shipments beginning in the first quarter.

Regal Rexnord Price Performance

Regal Rexnord stock traded down $9.72 during midday trading on Thursday, hitting $163.66. 780,702 shares of the company’s stock were exchanged, compared to its average volume of 1,153,070. The company has a market cap of $10.90 billion, a P/E ratio of 47.28, a PEG ratio of 1.43 and a beta of 1.09. The company has a debt-to-equity ratio of 0.64, a quick ratio of 1.16 and a current ratio of 2.21. The stock has a 50-day moving average price of $158.28 and a two-hundred day moving average price of $189.49. Regal Rexnord has a 52-week low of $127.96 and a 52-week high of $247.80.

Regal Rexnord Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, January 14th. Investors of record on Thursday, December 31st will be given a dividend of $0.35 per share. This represents a $1.40 annualized dividend and a yield of 0.9%. The ex-dividend date is Thursday, December 31st. Regal Rexnord’s payout ratio is presently 28.87%.

Wall Street Analysts Forecast Growth

RRX has been the topic of a number of analyst reports. Wolfe Research set a $250.00 price objective on Regal Rexnord in a research note on Thursday, July 9th. Wall Street Zen raised Regal Rexnord from a “hold” rating to a “buy” rating in a report on Saturday, October 24th. The Goldman Sachs Group set a $216.00 target price on Regal Rexnord in a report on Wednesday, September 30th. Deutsche Bank Aktiengesellschaft assumed coverage on Regal Rexnord in a research report on Monday, July 20th. They set a “buy” rating and a $286.00 price target on the stock. Finally, Citigroup increased their price target on shares of Regal Rexnord from $200.00 to $210.00 and gave the stock a “buy” rating in a report on Wednesday. Eight research analysts have rated the stock with a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus price target of $231.33.

Regal Rexnord Company Profile

Regal Rexnord Corporation is an industrial manufacturing company that develops and produces electric motors, power transmission components, motion-control systems and other equipment used in industrial and commercial applications. Its products include motors, gearboxes, bearings, couplings, belts, chains, drives, clutches, brakes and related controls, as well as air-moving and power-management solutions.

The company serves customers across industries such as automation, material handling, food and beverage, renewable energy, heating and ventilation, agriculture, and general industrial production.