In a report released on May 16, Kristine Liwag from Morgan Stanley maintained a Buy rating on RBC Bearings (RBC – Research Report), with a price target of $390.00.
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Kristine Liwag’s rating is based on RBC Bearings’ strong financial performance, particularly their adjusted earnings per share (EPS) of $2.83, which surpassed both consensus and Morgan Stanley estimates. This positive outcome was primarily due to lower than anticipated interest and tax expenses, despite revenues and adjusted EBITDA being largely in line with expectations. Additionally, the company’s adjusted EBITDA margin showed improvement, reflecting a year-over-year and sequential increase.
Another factor contributing to the Buy rating is the company’s reduced leverage, with net debt to EBITDA declining to 1.7x. While total revenues were slightly below Morgan Stanley estimates, net income exceeded both consensus and Morgan Stanley figures, indicating robust profitability. Although operating cash flow was below expectations, the lower interest and tax expenses provided a favorable impact on the overall financial results, supporting the positive outlook for RBC Bearings.
Liwag covers the Industrials sector, focusing on stocks such as Boeing, Hexcel, and Aercap Holdings. According to TipRanks, Liwag has an average return of 12.8% and a 63.60% success rate on recommended stocks.
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