RBC Bearings Incorporated RBC has been benefiting from strength in the Aerospace/Defense segment, driven by solid momentum in the commercial aerospace market. Strong growth in orders from the OEM (original equipment manufacturer) and the aftermarket verticals is driving the segment’s performance (revenues up 15.5% year over year in the first nine months of fiscal 2025). An increase in demand for the company’s bearings and engineered component products in the defense market is likely to bode well for the segment in the quarters ahead.

The company is also witnessing recovery in the Industrial segment (revenues up 2.7% year over year in third-quarter 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, 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%.

RBC Bearings intends to strengthen its business through acquisitions. It acquired Carson City, NV-based precision bearings manufacturer Specline, Inc. in August 2023. Specline’s unique bearing and manufacturing processes expanded RBC Bearings’ aerospace product offerings and boosted its production capacity.

The company also remains committed to rewarding its shareholders handsomely through dividends and share buyback programs. In the first nine months of fiscal 2025, it paid dividends of $17.2 million and repurchased shares for $8.6 million. It repurchased shares worth $11 million and distributed preferred dividends worth $22.9 million in fiscal 2024.

RBC’s Price Performance

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In the past six months, shares of this Zacks Rank #3 (Hold) company have risen 16.9% against the industry’s 15.4% decline.

However, weak refinery demand, which is affecting the oil and gas end markets, remains a persistent concern for the Industrial segment. The Industrial segment’s revenues declined approximately 1% year over year in the first nine months of fiscal 2025.

RBC has been dealing with rising costs and expenses. In the first nine months of fiscal 2025, the company’s cost of sales increased 1.8% year over year. Increasing raw material costs are pushing up the cost of sales. Selling, general and administrative expenses increased 9.6% year over year in the same period due to rising personnel costs and stock compensation costs.

Stocks to Consider

Some better-ranked companies from the same space are discussed below.

DNOW Inc. DNOW currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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 10.3%.

Dover Corporation DOV presently carries a Zacks Rank #2 (Buy). The company delivered a trailing four-quarter average earnings surprise of 5.3%.

In the past 60 days, the consensus estimate for DOV’s 2025 earnings has increased 0.3%.

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 0.3% in the past 60 days.

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Dover Corporation (DOV) : Free Stock Analysis Report

RBC Bearings Incorporated (RBC) : Free Stock Analysis Report

Applied Industrial Technologies, Inc. (AIT) : Free Stock Analysis Report

DNOW Inc. (DNOW) : Free Stock Analysis Report

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

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