Quality Investor

Regal Rexnord Corporation

Rank #400Hypergrowth

RRX · NYSE · Industrials

Regal Rexnord Corporation (RRX) — Rank #400 by gross profitability (GP/assets 0.16) · ROE 4.0% · Piotroski F-Score 4 / 9.

As-of 2026-09-15 · CIK 0000082811 · all metrics point-in-time as of the filing date.

About

Regal Rexnord Corporation provides sustainable solutions for power, transmit, and control motion products in the North America, Asia, Europe, and internationally.

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The company operates through Automation & Motion Control, Industrial Powertrain Solutions, and Power Efficiency Solutions. The Automation & Motion Control segment provides conveyor products, conveying automation subsystems, aerospace components, precision motion control solutions, miniature servo motors, controls, drives, and linear actuators, as well as power management products that include automatic transfer switches, paralleling switchgear, and customized modular electric pod solutions that comprise relevant power and thermal management content. The Industrial Powertrain Solutions segment offers mounted and unmounted bearings, couplings, mechanical power transmission drives and components, gearboxes and gear motors, clutches, brakes, and industrial powertrain components and solutions, as well as industrial powertrain solutions. The Power Efficiency Solutions segment produces fractional to approximately 5 horsepower AC and DC motors, electronic variable speed controls, electronic drives, fans and blowers, as well as integrated air moving subsystems. It serves factory automation, food and beverage, aerospace, general industrial, medical, data center, general industrial, metals and mining, energy, discrete automation, commercial HVAC, and general commercial applications. The company was formerly known as Regal Beloit Corporation.

Regal Rexnord Corporation was founded in 1955 and is based in Milwaukee, Wisconsin.

Industry
Specialty Industrial Machinery
Sector
Industrials
State
WI
Filer Category
Large accelerated filer
Fiscal Year End
December 31

Price History

RRX+17.9% · +3.3% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/S is the primary valuation lens — earnings are reinvested, not available for P/E.

Market Cap

$10.12B

P/E (annual)

36.2

P/S (annual)

1.7

P/B

1.5

P/OCF (annual)

10.2

Shareholder Yield

-45.8%

Employees

28,700

Industry

Specialty Industrial Machinery

Exchange

NYSE

Signal Flags

3 green2 yellow1 red
Revenue growth acceleratingGrowth rate increasing year over year
Operating leverage expandingOperating income growing faster than revenue
Sequential beat (rev + EPS)Both revenue and EPS exceeded prior quarter — 2-quarter streak
Dilution above 2%Annual share count increase exceeds 2%. May be acceptable for high-growth companies funding talent via stock compensation
Disclosure regressionA previously-disclosed line item is no longer reported — worth checking the filing for why
Balance sheet deterioratingNet cash collapsed with receivables or inventory outpacing revenue

Quality Profile

Profitability

1/1 pass
GP / assets
0.16
Return on equity
4.0%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
0.99
Current ratio
2.28×
Net cash
-$4.17B

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.6%

Growth

1/2 pass
Revenue growth
91.7%
Piotroski F-Score
4 / 9
Share dilution
46.7%

Terry Smith quality gate

Passes 1/5 Terry Smith thresholds

1 of 5 threshold not computable from filed data.

What Growth Is Priced In

Implied revenue growth (10Y)

-0.1%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Dilution drag: 46.7% — per-share value needs a total required return of 46.6% once share-count change is priced in.

vs. own 6-year median revenue growth: 5.2%

within its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

-3.9%

r = 10% (base)

-0.1%

r = 12%

3.2%

Net debt / market cap: 41.2%— material leverage inflates the implied growth read.

Note: current FCF margin is 1.9σ above its historical mean — implied growth may understate valuation risk if the margin reverts.

Base FCF: $893.1M3Y mean FCF: $214.6M

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

30.1xExpensive
14.6xmed 17.4x113.2x

P / S

Price / revenue per share

2.0xExpensive
1.0xmed 1.1x2.0x

P / B

Price / book value per share

2.2xExpensive
1.5xmed 1.7x2.2x

P / GP

Price / gross profit per share

7.0xExpensive
3.8xmed 4.3x7.0x

P / FCF

Price / free cash flow per share

14.7xFair
11.0xmed 14.7x16.5x

Revenue growth and the path to profitability (margin trend) are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.16

Primary signal (Novy-Marx).

9th pctl of 36 SIC 35 peers

Return on equity

4.0%

Gross margin

37.4%

34th pctl of 36 SIC 35 peers

Revenue growth (YoY)

91.7%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2015201820192021
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

Revenue CAGR (5Y)

Earnings CAGR (3Y)

-17.0%

FCF CAGR (3Y)

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

0.99

34th pctl of 36 SIC 35 peers (best = lowest)

Current ratio

2.28×

57th pctl of 36 SIC 35 peers

Quick ratio

0.82×

Net cash

-$4.17B

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$893.10M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

2.20

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.6%

Stock-based comp intensity.

Dividend safety

Composite score

2.8 / 5

Fair
Payout ratio
33.3%4/5 Strong
FCF coverage
9.60×5/5 Strong
Dividend growth streak
0 yr0/5 Weak
Balance-sheet health
D/E 0.99 · IC N/A2/5 Fair

Piotroski F-Score

F-Score

4 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20122021
Capital Return
Value