REGAL REXNORD CORP (RRX) Stock Fundamental Analysis
USA - NYSE:RRX - US7587501039 - Common Stock
146.92 USD
+1.88 (+1.3%)
146.92 USD
0 (0%)
RRX gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 92 industry peers in the Electrical Equipment industry. RRX scores excellent on profitability, but there are concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on RRX.
1. Profitability
1.1 Basic Checks
In the past year RRX was profitable.
RRX had a positive operating cash flow in the past year.
Of the past 5 years RRX 4 years were profitable.
In the past 5 years RRX always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of RRX (1.80%) is better than 72.83% of its industry peers.
RRX has a better Return On Equity (3.74%) than 71.74% of its industry peers.
RRX has a Return On Invested Capital of 4.46%. This is in the better half of the industry: RRX outperforms 71.74% of its industry peers.
The Average Return On Invested Capital over the past 3 years for RRX is significantly below the industry average of 10.15%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.8% | ||
| ROE | 3.74% | ||
| ROIC | 4.46% |
ROA(3y)1.93%
ROA(5y)2.43%
ROE(3y)3.29%
ROE(5y)4.19%
ROIC(3y)4.88%
ROIC(5y)5.01%
1.3 Margins
RRX's Profit Margin of 4.28% is fine compared to the rest of the industry. RRX outperforms 78.26% of its industry peers.
In the last couple of years the Profit Margin of RRX has declined.
The Operating Margin of RRX (12.04%) is better than 83.70% of its industry peers.
In the last couple of years the Operating Margin of RRX has grown nicely.
RRX has a Gross Margin of 37.23%. This is amongst the best in the industry. RRX outperforms 83.70% of its industry peers.
RRX's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.04% | ||
| PM (TTM) | 4.28% | ||
| GM | 37.23% |
OM growth 3Y2.96%
OM growth 5Y2.49%
PM growth 3Y-18.59%
PM growth 5Y-15.11%
GM growth 3Y7.59%
GM growth 5Y6.42%
2. Health
2.1 Basic Checks
RRX has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for RRX remains at a similar level compared to 1 year ago.
The number of shares outstanding for RRX has been increased compared to 5 years ago.
The debt/assets ratio for RRX has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.72, we must say that RRX is in the distress zone and has some risk of bankruptcy.
RRX has a Altman-Z score of 1.72. This is comparable to the rest of the industry: RRX outperforms 53.26% of its industry peers.
RRX has a debt to FCF ratio of 5.47. This is a neutral value as RRX would need 5.47 years to pay back of all of its debts.
The Debt to FCF ratio of RRX (5.47) is better than 73.91% of its industry peers.
RRX has a Debt/Equity ratio of 0.72. This is a neutral value indicating RRX is somewhat dependend on debt financing.
RRX has a Debt to Equity ratio of 0.72. This is comparable to the rest of the industry: RRX outperforms 40.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.72 | ||
| Debt/FCF | 5.47 | ||
| Altman-Z | 1.72 |
ROIC/WACC0.61
WACC7.32%
2.3 Liquidity
RRX has a Current Ratio of 2.00. This is a normal value and indicates that RRX is financially healthy and should not expect problems in meeting its short term obligations.
RRX has a Current ratio (2.00) which is in line with its industry peers.
RRX has a Quick Ratio of 2.00. This is a bad value and indicates that RRX is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.93, RRX perfoms like the industry average, outperforming 46.74% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.11% over the past year.
Measured over the past years, RRX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.44% on average per year.
The Revenue has decreased by -7.88% in the past year.
The Revenue has been growing by 13.26% on average over the past years. This is quite good.
EPS 1Y (TTM)9.11%
EPS 3Y1.35%
EPS 5Y10.44%
EPS Q2Q%8.3%
Revenue 1Y (TTM)-7.88%
Revenue growth 3Y16.56%
Revenue growth 5Y13.26%
Sales Q2Q%-3.33%
3.2 Future
Based on estimates for the next years, RRX will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.13% on average per year.
RRX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.52% yearly.
EPS Next Y9.85%
EPS Next 2Y12.24%
EPS Next 3Y12.13%
EPS Next 5YN/A
Revenue Next Year-2.66%
Revenue Next 2Y0.57%
Revenue Next 3Y1.52%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.53 indicates a correct valuation of RRX.
RRX's Price/Earnings ratio is rather cheap when compared to the industry. RRX is cheaper than 89.13% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.77, RRX is valued a bit cheaper.
The Price/Forward Earnings ratio is 12.79, which indicates a correct valuation of RRX.
Based on the Price/Forward Earnings ratio, RRX is valued cheaper than 91.30% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of RRX to the average of the S&P500 Index (23.23), we can say RRX is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.53 | ||
| Fwd PE | 12.79 |
4.2 Price Multiples
RRX's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. RRX is cheaper than 89.13% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of RRX indicates a rather cheap valuation: RRX is cheaper than 95.65% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.98 | ||
| EV/EBITDA | 11.82 |
4.3 Compensation for Growth
RRX's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of RRX may justify a higher PE ratio.
RRX's earnings are expected to grow with 12.13% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.58
PEG (5Y)1.49
EPS Next 2Y12.24%
EPS Next 3Y12.13%
5. Dividend
5.1 Amount
RRX has a yearly dividend return of 0.97%, which is pretty low.
RRX's Dividend Yield is rather good when compared to the industry average which is at 3.09. RRX pays more dividend than 88.04% of the companies in the same industry.
With a Dividend Yield of 0.97, RRX pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
5.2 History
The dividend of RRX has a limited annual growth rate of 5.45%.
RRX has paid a dividend for at least 10 years, which is a reliable track record.
RRX has decreased its dividend in the last 3 years.
Dividend Growth(5Y)5.45%
Div Incr Years0
Div Non Decr Years2
5.3 Sustainability
37.14% of the earnings are spent on dividend by RRX. This is a low number and sustainable payout ratio.
The dividend of RRX is growing, but earnings are growing more, so the dividend growth is sustainable.
DP37.14%
EPS Next 2Y12.24%
EPS Next 3Y12.13%
146.92
+1.88 (+1.3%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners108.11%
Inst Owner ChangeN/A
Ins Owners0.51%
Ins Owner Change2.62%
Market Cap9.75B
Analysts83.53
Price Target180.21 (22.66%)
Short Float %4.75%
Short Ratio3.8
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
Yearly Dividend1.4
Dividend Growth(5Y)5.45%
DP37.14%
Div Incr Years0
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.26%
Min EPS beat(2)0.45%
Max EPS beat(2)16.06%
EPS beat(4)2
Avg EPS beat(4)2.49%
Min EPS beat(4)-6.13%
Max EPS beat(4)16.06%
EPS beat(8)4
Avg EPS beat(8)-0.12%
EPS beat(12)8
Avg EPS beat(12)1.43%
EPS beat(16)10
Avg EPS beat(16)1.74%
Revenue beat(2)1
Avg Revenue beat(2)1.01%
Min Revenue beat(2)-0.59%
Max Revenue beat(2)2.61%
Revenue beat(4)1
Avg Revenue beat(4)-1.18%
Min Revenue beat(4)-3.82%
Max Revenue beat(4)2.61%
Revenue beat(8)2
Avg Revenue beat(8)-1.69%
Revenue beat(12)2
Avg Revenue beat(12)-1.42%
Revenue beat(16)5
Avg Revenue beat(16)-0.88%
PT rev (1m)-1.22%
PT rev (3m)3.41%
EPS NQ rev (1m)-0.56%
EPS NQ rev (3m)-3.3%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)0.16%
Revenue NQ rev (1m)-0.26%
Revenue NQ rev (3m)0.74%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)0.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.53 | ||
| Fwd PE | 12.79 | ||
| P/S | 1.67 | ||
| P/FCF | 10.98 | ||
| P/OCF | 9.81 | ||
| P/B | 1.46 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.82 |
EPS(TTM)9.46
EY6.44%
EPS(NY)11.49
Fwd EY7.82%
FCF(TTM)13.38
FCFY9.11%
OCF(TTM)14.97
OCFY10.19%
SpS88.18
BVpS100.94
TBVpS-52.74
PEG (NY)1.58
PEG (5Y)1.49
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.8% | ||
| ROE | 3.74% | ||
| ROCE | 5.57% | ||
| ROIC | 4.46% | ||
| ROICexc | 4.58% | ||
| ROICexgc | 26.56% | ||
| OM | 12.04% | ||
| PM (TTM) | 4.28% | ||
| GM | 37.23% | ||
| FCFM | 15.17% |
ROA(3y)1.93%
ROA(5y)2.43%
ROE(3y)3.29%
ROE(5y)4.19%
ROIC(3y)4.88%
ROIC(5y)5.01%
ROICexc(3y)5.16%
ROICexc(5y)5.49%
ROICexgc(3y)22.93%
ROICexgc(5y)21.5%
ROCE(3y)6.1%
ROCE(5y)6.26%
ROICexcg growth 3Y16.97%
ROICexcg growth 5Y6%
ROICexc growth 3Y6.15%
ROICexc growth 5Y-9.75%
OM growth 3Y2.96%
OM growth 5Y2.49%
PM growth 3Y-18.59%
PM growth 5Y-15.11%
GM growth 3Y7.59%
GM growth 5Y6.42%
F-Score7
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.72 | ||
| Debt/FCF | 5.47 | ||
| Debt/EBITDA | 4.01 | ||
| Cap/Depr | 20.94% | ||
| Cap/Sales | 1.8% | ||
| Interest Coverage | 2.05 | ||
| Cash Conversion | 82.17% | ||
| Profit Quality | 354.59% | ||
| Current Ratio | 2 | ||
| Quick Ratio | 0.93 | ||
| Altman-Z | 1.72 |
F-Score7
WACC7.32%
ROIC/WACC0.61
Cap/Depr(3y)24.27%
Cap/Depr(5y)28.18%
Cap/Sales(3y)1.78%
Cap/Sales(5y)1.68%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)9.11%
EPS 3Y1.35%
EPS 5Y10.44%
EPS Q2Q%8.3%
EPS Next Y9.85%
EPS Next 2Y12.24%
EPS Next 3Y12.13%
EPS Next 5YN/A
Revenue 1Y (TTM)-7.88%
Revenue growth 3Y16.56%
Revenue growth 5Y13.26%
Sales Q2Q%-3.33%
Revenue Next Year-2.66%
Revenue Next 2Y0.57%
Revenue Next 3Y1.52%
Revenue Next 5YN/A
EBIT growth 1Y-2.21%
EBIT growth 3Y20%
EBIT growth 5Y16.07%
EBIT Next Year71.97%
EBIT Next 3Y24.86%
EBIT Next 5YN/A
FCF growth 1Y63.25%
FCF growth 3Y18.14%
FCF growth 5Y9.6%
OCF growth 1Y50.85%
OCF growth 3Y19.43%
OCF growth 5Y8.33%