Regal Rexnord Corporation (RRX)
NYSE:RRX
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Regal Rexnord
(NYSE:RRX)
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Rating:65Neutral
Price Target:
$202.00
▼(-1.66% Downside)
Action:Reiterated
Date:05/12/26
RRX scores as a mid-quality, trend-supported industrial: strong free cash flow and improving demand/guidance are the main positives, reinforced by an uptrend in price. The biggest constraints are expensive valuation (high P/E/low yield) and profitability/return headwinds (thin net margins, moderate leverage/low ROE), with added near-term margin uncertainty highlighted on the earnings call.
Positive Factors
Free cash flow generation
Consistent high free cash flow (~$805M TTM) provides durable funding for debt reduction, capex, buybacks or reinvestment in NPD and sales initiatives, supporting long-term operational flexibility and capital allocation even if earnings remain volatile.
Negative Factors
Margin compression and AMC margin decline
Sustained margin pressure—company EBITDA down ~120bps with AMC margins deteriorating for consecutive quarters—reflects structural mix shifts toward OEM, higher growth investments and cost headwinds that can persistently compress profitability absent permanent mix or pricing improvements.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Consistent high free cash flow (~$805M TTM) provides durable funding for debt reduction, capex, buybacks or reinvestment in NPD and sales initiatives, supporting long-term operational flexibility and capital allocation even if earnings remain volatile.
Read all positive factors
Regal Rexnord (RRX) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.99B
Dividend Yield0.97%
Average Volume (3M)1.20M
Price to Earnings (P/E)48.4
Beta (1Y)1.31
Revenue Growth1.54%
EPS Growth22.59%
CountryUS
Employees30,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)4.32
Shares Outstanding66,569,570
10 Day Avg. Volume1,507,173
30 Day Avg. Volume1,199,582
Financial Highlights & Ratios
PEG Ratio0.77
Price to Book (P/B)1.36
Price to Sales (P/S)1.57
P/FCF Ratio10.42
Enterprise Value/Market Cap1.34
Enterprise Value/Revenue2.91
Enterprise Value/Gross Profit7.77
Enterprise Value/Ebitda14.68
Forecast
1Y Price Target
$250.83Price Target Upside22.12% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)10.62
Revenue Forecast (FY)$6.23B
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 comp...
How the Company Makes Money
Regal Rexnord makes money primarily by selling engineered, branded industrial components and systems that transmit power, control motion, and improve equipment efficiency and reliability. Revenue is generated through (1) original equipment manufac...
Regal Rexnord Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 03, 2026
Earnings Call Sentiment Positive
The call conveyed a constructive growth story: order momentum (notably a 34% surge in AMC orders), raised top-line growth assumptions across segments, maintained earnings and cash-flow guidance, and a sizable multi-year data center opportunity. However, Q1 margins were pressured (adjusted EBITDA down ~120 bps), AMC margins have faced sustained YoY declines, PES residential HVAC remains weak (sales down >20%), and tariff/rare earth uncertainties and OEM-heavy mix create measured conservatism in margin guidance. On balance the positives (strong orders, improved demand visibility, upgraded sales guidance, and strategic wins/cross-sell) outweigh the near-term margin and end-market challenges.Positive Updates
Enterprise Orders and Backlog Growth
Orders in the quarter were up 8.5% on a daily basis versus prior year, and backlog rose 6.7% sequentially versus Q4, with enterprise orders in April up 4.6% on a daily basis.
Negative Updates
Adjusted EBITDA Margin Compression
Company adjusted EBITDA margin was 20.6% in Q1, down ~120 basis points year-over-year; management cited mix, tariff/price-cost effects, rare earth magnet constraints and higher growth investments as drivers of margin pressure.
Read all updates
Q1-2026 Updates
Positive
Negative
Enterprise Orders and Backlog Growth
Orders in the quarter were up 8.5% on a daily basis versus prior year, and backlog rose 6.7% sequentially versus Q4, with enterprise orders in April up 4.6% on a daily basis.
Read all positive updates
Company Guidance
Regal Rexnord updates 2026 guidance assuming enterprise sales growth of roughly 4.5% (up 150 bps vs. prior), an adjusted EBITDA margin of 22.2%, adjusted EPS of $10.20–$11.00 (midpoint ≈10% EPS growth) and cash flow of $650 million, while excluding remaining cost synergies; unmitigated tariff exposure is revised to $127 million (from $155M) and the company expects to be dollar-cost neutral by mid‑2026 and margin‑neutral by year‑end. Q1 results that inform the guide included daily orders +8.5% YoY, backlog +6.7% sequentially, April orders +4.6% daily, sales +4.3% (+1.6% organic), adjusted gross margin 37.7%, company adjusted EBITDA margin 20.6% (down 120 bps YoY), adjusted EPS $2.17 (+~1% YoY) and adjusted free cash flow roughly flat. By segment, AMC Q1 sales +12.1% organic, orders +34% and book‑to‑bill 1.24 (AMC full‑year sales guide raised to high‑single‑digits; midpoint EBITDA margin ~20.5%); IPS Q1 sales +2.8% organic, orders down 1.4% (book‑to‑bill 1.09) with IPS full‑year sales guide to mid‑single‑digits and margin midpoint down ~50 bps; PES Q1 sales −10.3% organic, orders down ~60 bps (book‑to‑bill 1.13) with full‑year sales now guided to flat to low‑single‑digit and Q1 PES EBITDA 15.8% (above prior range). Management notes upside potential from mix improvements, ePOD volume, possible IEEPA refunds and synergy realization, but is remaining measured given geopolitical and macro uncertainties.Regal Rexnord Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
58
Neutral
Cash Flow
76
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.00B | 5.93B | 6.03B | 6.25B | 5.22B | 3.81B |
| Gross Profit | 2.25B | 2.22B | 2.20B | 2.11B | 1.70B | 1.07B |
| EBITDA | 1.19B | 1.20B | 1.17B | 971.00M | 1.04B | 573.00M |
| Net Income | 286.60M | 279.50M | 196.20M | -57.40M | 488.90M | 229.60M |
Balance Sheet | ||||||
| Total Assets | 13.78B | 13.92B | 14.03B | 15.43B | 10.27B | 10.37B |
| Cash, Cash Equivalents and Short-Term Investments | 401.00M | 521.70M | 393.50M | 574.00M | 688.50M | 672.80M |
| Total Debt | 4.86B | 5.06B | 5.61B | 6.55B | 2.14B | 2.04B |
| Total Liabilities | 6.97B | 7.07B | 7.77B | 9.07B | 3.85B | 3.96B |
| Stockholders Equity | 6.81B | 6.84B | 6.26B | 6.34B | 6.39B | 6.37B |
Cash Flow | ||||||
| Free Cash Flow | 805.10M | 893.10M | 499.90M | 596.20M | 352.40M | 303.20M |
| Operating Cash Flow | 903.40M | 990.80M | 609.40M | 715.30M | 436.20M | 357.70M |
| Investing Cash Flow | -84.90M | -71.00M | 275.40M | -4.98B | -113.30M | -175.70M |
| Financing Cash Flow | -737.00M | -814.10M | -1.10B | 4.20B | -274.20M | -117.60M |
Regal Rexnord Technical Analysis
Neutral
205.40
Price Trends
199.57
Negative
190.63
Positive
166.63
Positive
Market Momentum
-2.41
Positive
44.42
Neutral
19.53
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RRX, the sentiment is Neutral. The current price of 205.4 is below the 20-day moving average (MA) of 208.41, above the 50-day MA of 199.57, and above the 200-day MA of 166.63, indicating a neutral trend. The MACD of -2.41 indicates Positive momentum. The RSI at 44.42 is Neutral, neither overbought nor oversold. The STOCH value of 19.53 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RRX.
Regal Rexnord Risk Analysis
Regal Rexnord disclosed 36 risk factors in its most recent earnings report. Regal Rexnord reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Regal Rexnord Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $9.99B | 23.86 | 18.38% | 0.70% | 14.22% | 25.22% | |
72 Outperform | $7.81B | 19.44 | 28.42% | 2.04% | 0.23% | 4.76% | |
72 Outperform | $10.29B | 37.82 | 12.67% | ― | 17.39% | 20.78% | |
70 Outperform | $9.61B | 31.85 | 25.19% | 1.28% | 3.28% | -6.52% | |
70 Outperform | $10.01B | 36.76 | 16.30% | 0.49% | 7.18% | 5.22% | |
65 Neutral | $12.99B | 48.42 | 4.23% | 0.97% | 1.54% | 22.59% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
RRX
Regal Rexnord
195.19
61.77
46.30%
DCI
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82.95
15.05
22.16%
AOS
A. O. Smith Corporation
56.68
-9.06
-13.78%
SPXC
SPX
205.55
53.39
35.09%
WTS
Watts Water Technologies
299.15
62.90
26.62%
CR
Crane Company
173.41
3.63
2.14%
Regal Rexnord Corporate Events
Executive/Board ChangesShareholder Meetings
Regal Rexnord Shareholders Back Board, Pay, and Auditor
Positive
Apr 30, 2026
Regal Rexnord Corporation held its 2026 annual meeting of shareholders on April 28, 2026, where investors voted on board elections, executive pay, and the company’s external auditor. Shareholders cast votes representing 63,726,776 shares out...
Executive/Board Changes
Regal Rexnord Announces CEO Transition to Aamir Paul
Positive
Apr 22, 2026
On April 22, 2026, Regal Rexnord announced that Aamir Paul will succeed Louis V. Pinkham as Chief Executive Officer no later than July 1, 2026, following the conclusion of Paul’s responsibilities at Schneider Electric. Paul will also join th...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.