Regal Rexnord (RRX) AI Stock Analysis

• Market Cap: $10.72B
• Dividend Yield: 0.97%
• Average Volume (3M): 562.02K
• Price to Earnings (P/E): 41.8
• Beta (1Y): 1.38
• Revenue Growth: -4.99%
• EPS Growth: 22.16%
• Country: US
• Employees: 30,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 2.51
• Shares Outstanding: 66,389,670
• 10 Day Avg. Volume: 597,264
• 30 Day Avg. Volume: 562,024
• PEG Ratio: -0.12
• Price to Book (P/B): 1.65
• Price to Sales (P/S): 1.71
• P/FCF Ratio: 20.61
• Enterprise Value/Market Cap: 1.42
• Enterprise Value/Revenue: 2.60
• Enterprise Value/Gross Profit: 7.01
• Enterprise Value/Ebitda: 12.98
• 1Y Price Target: $170.00
• Price Target Upside: 5.26% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: $177.00 ▲(9.60% Upside)

Regal Rexnord's strong financial performance and positive earnings call outlook are significant strengths, indicating potential for future growth. However, technical indicators suggest bearish trends, and valuation metrics imply the stock may be overvalued, which could limit upside potential.

Positive Factors

Free Cash Flow Generation

Sustained free cash flow growth shows the company's ability to convert earnings into cash, supporting debt reduction, capex, dividends, and M&A. Over 2-6 months this underpins financial flexibility, resilience through cyclicality, and the capacity to fund strategic investments without relying on external financing.

Debt Reduction and Interest Rate Exposure

Active debt paydown and elimination of variable-rate borrowings materially reduce interest-rate and refinancing risk. This improves balance sheet stability and covenant headroom, enabling management to pursue growth or weather downturns with lower financial leverage and more predictable interest expense over the medium term.

Data Center Market Momentum

Rapid expansion in the data center end market represents a structural revenue diversification into a high-growth, higher-demand segment. A large bid pipeline and outsized growth versus five years ago signal durable secular tailwinds that can lift topline growth and improve long-term product mix and margins.

Negative Factors

Rare Earth Magnet Sourcing & Tariffs

Ongoing supply constraints and tariff exposure are structural cost and operational risks for product lines dependent on rare earth magnets. These issues can persist, raising input costs, forcing product redesigns or shipment delays, and permanently compressing margins or slowing growth in sensitive end markets.

Guidance Reduction Reflecting Margin Pressure

Management lowering full-year guidance signals persistent margin headwinds rather than a one-off shock. This constrains medium-term earnings visibility, may limit reinvestment or return-of-capital plans, and indicates operational or cost issues that could take multiple quarters to rectify.

Low Net Profitability

A low net margin limits the firm's ability to convert revenue into shareholder returns and reduces the buffer against cyclical downturns. Even with healthy gross margins, weak net profitability constrains reinvestment, lowers ROE, and makes achieving durable EPS growth more challenging over the medium term.

Regal Rexnord Business Overview & Revenue Model

Company Description

Regal Rexnord Corporation, together with its subsidiaries, designs, manufactures, and sells industrial powertrain solutions, power transmission components, electric motors and electronic controls, air moving products, and specialty electrical components and systems worldwide. It operates through four segments: Commercial Systems, Industrial Systems, Climate Solutions, and Motion Control Solutions. The Commercial Systems segment provides AC and DC motors, electronic variable speed controls, fans, blowers, and precision stator and rotor kits. The Industrial Systems segment offers AC motors for industrial applications; electric alternators for prime and standby power applications to data centers, distributed energy, microgrid, rental marine, agriculture, healthcare, mobile, and defense markets; and switchgear for healthcare, government, and waste water applications, as well as residential, commercial, and industrial applications. The Climate Solutions segment provides fractional motors, electronic variable speed controls, and blowers for use in a residential and light commercial air moving applications; and fractional horsepower motors and blowers for white goods, water heating equipment, small pumps, compressors, and fans. The Motion Control Solutions segment offers bearings; conveyors; disc, gear, grid, elastomeric, and torsionally soft couplings; mechanical power transmission drives and components; worm gearing, shaft configuration, helical, bevel, helical bevel, worm, hypoid, and spur gearing products; and aerospace components. This segment serves beverage, bulk handling, metal, special machinery, energy, and aerospace and general industrial markets. The company sells its products directly to original equipment manufacturers and end-users through a network of direct and independent sales representatives, and distributors. The company was formerly known as Regal Beloit Corporation. The company was founded in 1955 and is headquartered in Beloit, Wisconsin.

How the Company Makes Money

Regal Rexnord generates revenue primarily through the sale of its extensive portfolio of power transmission and motion control products. The company employs a multi-channel distribution strategy that includes direct sales, distributors, and online platforms, allowing it to reach a broad customer base across different industries. Key revenue streams include the sale of components like bearings, motors, and gear drives, as well as aftermarket services and support, which provide recurring income. Additionally, Regal Rexnord benefits from strategic partnerships and collaborations with OEMs (Original Equipment Manufacturers) and system integrators, enhancing its market presence and enabling the company to leverage new technologies and innovations. The company's investment in research and development also plays a crucial role in maintaining a competitive edge, helping to drive sales of advanced, energy-efficient products that meet evolving customer demands.

Regal Rexnord Financial Statement Overview

Summary

Regal Rexnord demonstrates strong revenue growth and efficient cash flow management, positioning it well in the industrial machinery sector. While profitability margins and return on equity are areas for improvement, the company's reduced leverage and robust cash generation provide a solid foundation for future growth.

Income Statement

Regal Rexnord shows a strong revenue growth rate of 33.5% in the TTM, indicating robust sales performance. The gross profit margin of 37% is healthy, reflecting efficient cost management. However, the net profit margin is relatively low at 4.38%, suggesting potential areas for improving profitability. EBIT and EBITDA margins are moderate, indicating stable operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.73 in the TTM, showing a reduction in leverage compared to previous years. Return on equity is modest at 3.94%, indicating room for enhancing shareholder returns. The equity ratio is stable, reflecting a balanced capital structure.

Cash Flow

Free cash flow growth is strong at 5.46% in the TTM, highlighting effective cash generation. The operating cash flow to net income ratio of 0.82 indicates solid cash flow management. Free cash flow to net income ratio is high at 0.90, suggesting efficient conversion of profits into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.87B	6.03B	6.25B	5.22B	3.81B	2.91B
Gross Profit	2.17B	2.20B	2.11B	1.70B	1.07B	828.40M
EBITDA	1.18B	1.17B	971.00M	1.04B	573.00M	447.20M
Net Income	257.30M	196.20M	-57.40M	488.90M	229.60M	189.30M
Balance Sheet
Total Assets	13.87B	14.03B	15.43B	10.27B	10.37B	4.59B
Cash, Cash Equivalents and Short-Term Investments	400.00M	393.50M	574.00M	688.50M	672.80M	611.30M
Total Debt	4.93B	5.61B	6.55B	2.14B	2.04B	1.15B
Total Liabilities	7.10B	7.77B	9.07B	3.85B	3.96B	2.01B
Stockholders Equity	6.76B	6.26B	6.34B	6.39B	6.37B	2.54B
Cash Flow
Free Cash Flow	936.40M	499.90M	596.20M	352.40M	303.20M	387.90M
Operating Cash Flow	1.04B	609.40M	715.30M	436.20M	357.70M	435.40M
Investing Cash Flow	-72.60M	275.40M	-4.98B	-113.30M	-175.70M	-37.00M
Financing Cash Flow	-1.02B	-1.10B	4.20B	-274.20M	-117.60M	-147.60M

Regal Rexnord Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 161.50
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RRX, the sentiment is Positive. The current price of 161.5 is above the 20-day moving average (MA) of 155.16, above the 50-day MA of 147.90, and above the 200-day MA of 141.66, indicating a bullish trend. The MACD of 3.35 indicates Negative momentum. The RSI at 60.82 is Neutral, neither overbought nor oversold. The STOCH value of 76.14 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RRX.

Regal Rexnord Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DCI	77 Outperform	$11.76B	31.81	24.96%	1.28%	2.37%	-6.93%
AOS	77 Outperform	$10.23B	19.09	29.20%	2.04%	-1.64%	-2.50%
SPXC	77 Outperform	$10.39B	44.46	12.76%	―	12.60%	24.02%
WTS	77 Outperform	$9.98B	30.89	17.81%	0.70%	4.18%	16.05%
RRX	69 Neutral	$10.72B	41.77	3.89%	0.97%	-4.99%	22.16%
CR	65 Neutral	$10.52B	29.18	17.92%	0.49%	-0.37%	21.77%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Regal Rexnord Corporate Events

Regal Rexnord Secures New Credit Agreement with JPMorgan

On November 21, 2025, Regal Rexnord Corporation entered into a Third Amended and Restated Credit Agreement with a group of financial institutions, facilitated by JPMorgan Chase Bank. This agreement replaces the previous credit arrangement from March 2022 and includes an $850 million unsecured Delayed Draw Term Loan and a $1.5 billion revolving line of credit. The new credit facilities are intended to refinance existing debt, cover fees and expenses, and support the company’s working capital and general corporate purposes. The agreement imposes financial covenants and restrictions on the company and its subsidiaries, aiming to maintain financial stability and operational flexibility.

The most recent analyst rating on (RRX) stock is a Buy with a $165.00 price target. To see the full list of analyst forecasts on Regal Rexnord stock, see the RRX Stock Forecast page.