Regal Rexnord (NYSE:RRX) Issues Earnings Results, Beats Expectations By $0.41 EPS

Key Points

• Regal Rexnord beat quarterly earnings expectations: Adjusted EPS was $2.99 versus the $2.58 consensus, while revenue rose 4.2% year over year to $1.56 billion but fell short of the $1.58 billion estimate.
• Demand remained healthy, with enterprise daily orders up 8.8% and AMC sales increasing 15.6% organically; the company raised its full-year AMC growth outlook to the low double digits.
• Margin concerns pressured investors: Management lowered its underlying 2026 adjusted EBITDA margin outlook because of slower productivity gains, inflation and unfavorable mix. Shares fell 15.6%, while full-year adjusted EPS guidance was maintained at a $10.60 midpoint partly supported by expected tariff refunds.

Regal Rexnord (NYSE:RRX - Get Free Report) posted its quarterly earnings results on Wednesday. The company reported $2.99 EPS for the quarter, beating the consensus estimate of $2.58 by $0.41, FiscalAI reports. The firm had revenue of $1.56 billion during the quarter, compared to analysts' expectations of $1.58 billion. Regal Rexnord had a return on equity of 9.49% and a net margin of 4.78%.The company's revenue for the quarter was up 4.2% on a year-over-year basis. During the same quarter in the prior year, the firm posted $2.48 EPS. Regal Rexnord updated its FY 2026 guidance to 10.350-10.850 EPS.

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

• Order momentum remained strong, with enterprise daily orders up 8.8% year over year in Q2 and 7% in July; AMC orders rose 17.1%, led by aerospace and defense, discrete automation, and data centers.
• AMC sales increased 15.6% organically, prompting the company to raise its full-year AMC growth outlook to low double digits. The ePOD facility remains on schedule, with approximately $15 million of revenue now expected in Q4 and additional orders potentially arriving late this year or early 2027.
• Despite strong orders, management lowered its underlying 2026 adjusted EBITDA margin outlook to 21.3% excluding tariff refunds, citing slower productivity gains, inflation outpacing price realization, and unfavorable mix; second-half price-cost pressure is expected to persist.
• Segment outlooks diverged, with IPS growth reduced to low single digits due to large-project timing and prior-year metals and mining comparisons, while PES now expects flat to low-single-digit sales decline amid weak residential HVAC and pool markets, channel destocking, and softer consumer demand.
• Adjusted EPS guidance was maintained at a $10.60 midpoint, including $48 million of expected tariff-refund benefits, while free-cash-flow guidance fell $50 million to $600 million as stronger AMC growth requires more working capital; net leverage is still expected to fall below 3x in the second half.

Regal Rexnord Trading Down 15.6%

NYSE:RRX traded down $34.40 during mid-day trading on Wednesday, hitting $185.65. The company had a trading volume of 2,945,878 shares, compared to its average volume of 1,112,973. The business's fifty day moving average is $213.60 and its two-hundred day moving average is $202.63. Regal Rexnord has a fifty-two week low of $127.96 and a fifty-two week high of $247.80. The firm has a market cap of $12.36 billion, a P/E ratio of 43.48, a P/E/G ratio of 1.40 and a beta of 1.09. The company has a debt-to-equity ratio of 0.69, a quick ratio of 1.08 and a current ratio of 2.17.

Regal Rexnord Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, October 14th. Stockholders of record on Wednesday, September 30th will be paid a $0.35 dividend. The ex-dividend date of this dividend is Wednesday, September 30th. This represents a $1.40 dividend on an annualized basis and a dividend yield of 0.8%. Regal Rexnord's dividend payout ratio is 32.56%.

Trending Headlines about Regal Rexnord

Here are the key news stories impacting Regal Rexnord this week:

• Positive Sentiment: Regal Rexnord reported second-quarter adjusted EPS of $2.99, up from $2.48 a year earlier and above the roughly $2.58–$2.60 analyst consensus. Adjusted EBITDA increased 11.2% year over year to $366.6 million. Regal Rexnord Reports Second Quarter 2026 Financial Results
• Positive Sentiment: Operating indicators were constructive: daily orders rose 8.8%, sales increased 4.2% year over year to $1.56 billion, with organic growth of 3.3%, while operating cash flow reached $176.6 million and free cash flow was $154.1 million. The company also expects net leverage to fall below 3.0 times adjusted EBITDA during the second half of 2026. Quarterly Financial Results
• Neutral Sentiment: Management narrowed its full-year 2026 adjusted EPS guidance to $10.35–$10.85, maintaining a midpoint of $10.60. However, the range includes approximately $0.57 per share from IEEPA tariff refunds, which may make the underlying earnings outlook less compelling. Regal Rexnord Tops Q2 Earnings Estimates
• Negative Sentiment: Revenue fell short of analyst expectations, and investors focused on margin pressure and the quality of the earnings beat. Second-quarter adjusted EBITDA and adjusted EPS benefited from a $32 million tariff refund, or $0.39 per share, while the full-year guidance midpoint is below consensus expectations of approximately $10.69 per share. These factors outweighed the earnings and order growth, contributing to the stock’s decline. Regal Rexnord’s Shares Fall as Margin Outlook Weighs

Wall Street Analysts Forecast Growth

Several brokerages have issued reports on RRX. Deutsche Bank Aktiengesellschaft began coverage on shares of Regal Rexnord in a report on Monday, July 20th. They issued a "buy" rating and a $286.00 price target on the stock. KeyCorp raised their price target on shares of Regal Rexnord from $255.00 to $265.00 and gave the stock an "overweight" rating in a research note on Thursday, May 7th. Weiss Ratings reaffirmed a "hold (c)" rating on shares of Regal Rexnord in a report on Friday, July 17th. Oppenheimer reiterated an "outperform" rating on shares of Regal Rexnord in a research note on Friday, July 10th. Finally, Wolfe Research set a $250.00 target price on Regal Rexnord in a research report on Thursday, July 9th. Eight analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company. According to MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and a consensus target price of $247.00.

Insiders Place Their Bets

In other Regal Rexnord news, CEO Louis V. Pinkham sold 22,509 shares of the firm's stock in a transaction that occurred on Monday, May 11th. The shares were sold at an average price of $211.68, for a total transaction of $4,764,705.12. Following the sale, the chief executive officer directly owned 56,749 shares in the company, valued at approximately $12,012,628.32. This trade represents a 28.40% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through this link. Also, CFO Robert Rehard sold 6,499 shares of the company's stock in a transaction that occurred on Friday, May 22nd. The shares were sold at an average price of $200.00, for a total transaction of $1,299,800.00. Following the completion of the transaction, the chief financial officer owned 27,965 shares of the company's stock, valued at $5,593,000. This trade represents a 18.86% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 30,305 shares of company stock worth $6,341,869 over the last ninety days. 0.63% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently modified their holdings of the company. Viking Global Investors LP raised its position in Regal Rexnord by 25.7% in the 2nd quarter. Viking Global Investors LP now owns 3,430,128 shares of the company's stock valued at $497,231,000 after buying an additional 701,145 shares during the last quarter. Dimensional Fund Advisors LP boosted its holdings in Regal Rexnord by 5.5% during the fourth quarter. Dimensional Fund Advisors LP now owns 2,530,092 shares of the company's stock worth $355,031,000 after purchasing an additional 131,171 shares during the last quarter. Invesco Ltd. grew its position in Regal Rexnord by 27.1% in the fourth quarter. Invesco Ltd. now owns 1,905,828 shares of the company's stock valued at $267,426,000 after purchasing an additional 405,828 shares in the last quarter. The Manufacturers Life Insurance Company increased its stake in Regal Rexnord by 7.3% in the 4th quarter. The Manufacturers Life Insurance Company now owns 1,251,095 shares of the company's stock valued at $175,554,000 after buying an additional 85,242 shares during the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC boosted its stake in shares of Regal Rexnord by 3.6% during the 3rd quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 1,186,366 shares of the company's stock worth $170,172,000 after buying an additional 41,004 shares during the last quarter. 99.72% of the stock is owned by institutional investors and hedge funds.

Regal Rexnord Company Profile

Regal Rexnord Corporation NYSE: RRX is a global industrial manufacturer specializing in electric motors, power generation equipment and automated motion control systems. The company designs, engineers and produces a broad portfolio of products that includes energy-efficient electric motors, variable frequency drives, gearboxes, couplings, bearings and power transmission components. These offerings support critical applications in industries such as heating, ventilation and air conditioning (HVAC), refrigeration, data centers, water treatment, food and beverage processing, mining, oil and gas, and material handling.

The company's operations are organized into multiple business segments that address distinct customer needs.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source