RBC Bearings Incorporated RBC is poised to benefit from strength across its businesses, synergies from acquisitions and shareholder-friendly policies. The company remains focused on investing in growth opportunities and strengthening its long-term market position.

RBC, which has a market capitalization of $11.1 billion, currently carries a Zacks Rank #2 (Buy). Let’s delve into the factors that have been aiding the firm for a while now.

End-Market Strength: RBC Bearings is benefiting from the strong performance of the Aerospace/Defense segment. Strength in the commercial aerospace market, driven by strong growth in orders from the OEM (original equipment manufacturer) and aftermarket verticals, is driving the segment (revenues up 15.5% year over year in the first nine months of fiscal 2025). The robust backlog level, along with the company’s strong execution of incremental orders in the commercial aerospace market, is expected to be beneficial for the segment. 

An increase in demand for the company’s bearings and engineered component products in the defense market, supported by growth in marine, helicopter and missile applications orders, will likely augur well for the Aerospace/Defense segment in the quarters ahead. 

The company is witnessing recovery in the Industrial segment (revenues up 2.7% year over year in third-quarter of fiscal 2025). Stable demand for its highly engineered bearings and precision components in the mining and metals, food and beverage, power generation, logistics and grain markets bodes well. For the fourth quarter of fiscal 2025 (ending March 2025), RBC Bearings anticipates net sales to be in the range of $434-$444 million, indicating a year-over-year increase of 4.9-7.3%.

Acquisition Benefits: The company has been strengthening its business through acquisitions. It acquired Carson City, NV-based precision bearings manufacturer Specline, Inc. in August 2023. The transaction was valued at $18.7 million. Specline’s unique bearing and manufacturing processes expanded RBC Bearings’ aerospace product offerings and boosted its production capacity.

RBC’s Price Performance

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In the past three months, the company has gained 5.3% against the industry’s 9% decline.

Shareholder-Friendly Policies: RBC Bearings remains committed to increasing shareholders’ value through dividend payments and share repurchases. In the first nine months of fiscal 2025, the company paid preferred dividends of $17.2 million, flat year over year, and repurchased shares for $8.6 million, increasing 12.9% year over year.

Estimate Revisions: In the past 60 days, the Zacks Consensus Estimate for RBC Bearings’ fiscal 2025 (ending March 2025) earnings has increased 1.2%. Also, the same for fiscal 2026 (ending March 2026) has been revised upward 4.7%.

Other Stocks to Consider

Some other top-ranked stocks from the same space are discussed below.

The Middleby Corporation MIDD presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

It has a trailing four-quarter earnings surprise of 1.9%, on average. The consensus estimate for MIDD’s 2025 earnings has inched up 0.8% in the past 60 days.

DNOW Inc. DNOW currently carries a Zacks Rank of 2. DNOW delivered a trailing four-quarter average earnings surprise of 30.4%. In the past 60 days, the Zacks Consensus Estimate for DNOW’s 2025 earnings has increased 8.9%.

Applied Industrial Technologies, Inc. AIT presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 5.3%. The Zacks Consensus Estimate for AIT’s fiscal 2025 (ending June 2025) earnings has improved 1.4% in the past 60 days.

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RBC Bearings Incorporated (RBC) : Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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