Regal Beloit Meets on the Top Line, Misses Where it Counts

Seth Jayson, The Motley Fool
Updated

Regal Beloit (NYS: RBC) reported earnings on July 30. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended June 29 (Q2), Regal Beloit met expectations on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue dropped. GAAP earnings per share contracted significantly.


Gross margins were steady, operating margins contracted, net margins contracted.

Revenue details
 Regal Beloit reported revenue of $822.0 million. The 12 analysts polled by S&P Capital IQ anticipated net sales of $819.2 million on the same basis. GAAP reported sales were 4.9% lower than the prior-year quarter's $863.9 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.

EPS details
 EPS came in at $1.13. The 14 earnings estimates compiled by S&P Capital IQ predicted $1.24 per share. GAAP EPS of $1.13 for Q2 were 24% lower than the prior-year quarter's $1.49 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.

Margin details
 For the quarter, gross margin was 25.5%, much about the same as the prior-year quarter. Operating margin was 9.9%, 210 basis points worse than the prior-year quarter. Net margin was 6.2%, 110 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
 Next quarter's average estimate for revenue is $788.0 million. On the bottom line, the average EPS estimate is $1.23.

Next year's average estimate for revenue is $3.12 billion. The average EPS estimate is $4.37.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 119 members out of 127 rating the stock outperform, and eight members rating it underperform. Among 44 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 43 give Regal Beloit a green thumbs-up, and one give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Regal Beloit is outperform, with an average price target of $73.73.

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The article Regal Beloit Meets on the Top Line, Misses Where it Counts originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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