Gates Industrial (NYSE:GTES) Issues Earnings Results

Gates Industrial (NYSE:GTES) announced its quarterly earnings results on Friday. The company reported $0.35 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.32 by $0.03, Briefing.com reports. The business had revenue of $851.10 million for the quarter, compared to analyst estimates of $859.72 million. Gates Industrial had a net margin of 7.30% and a return on equity of 10.36%. The company’s revenue was up .4% on a year-over-year basis. During the same quarter last year, the firm earned $0.36 EPS. Gates Industrial updated its FY 2026 guidance to 1.520-1.680 EPS.

Here are the key takeaways from Gates Industrial’s conference call:

• ERP transition in Europe caused distribution inefficiencies and above?normal operating costs, representing about a 600?basis?point headwind to core sales and roughly a $0.07 drag on adjusted EPS, though management says Europe stabilized and further improvement is expected in Q2.
• Reported Q1 sales of $851 million and Adjusted EBITDA of $177 million (20.8% margin) with Adjusted EPS $0.35; the company delivered ~101% free cash flow conversion, reduced net leverage to 1.9x, and received a Moody’s upgrade to Baa2.
• Management reiterated full?year 2026 guidance and guided Q2 revenue of $905–$945 million (midpoint ? 3.5% core growth), expecting temporary margin pressure in Q2 from ERP and footprint actions but forecasting an Adjusted EBITDA margin approaching ~23.5% in H2.
• Announced an opportunistic tuck?in acquisition of Timken’s industrial belt business (management cited ~ $5 million/month potential revenue), which should be accretive, help consolidate the market, and the company remains open to further M&A.

Gates Industrial Stock Down 5.9%

Gates Industrial stock traded down $1.51 during trading hours on Friday, hitting $24.10. The stock had a trading volume of 4,461,676 shares, compared to its average volume of 1,904,514. The company has a quick ratio of 2.42, a current ratio of 3.37 and a debt-to-equity ratio of 0.61. The stock has a market capitalization of $6.14 billion, a P/E ratio of 17.66 and a beta of 1.28. Gates Industrial has a 12-month low of $19.26 and a 12-month high of $28.47. The stock’s 50-day moving average price is $24.57 and its 200-day moving average price is $23.75.

Institutional Inflows and Outflows

Large investors have recently bought and sold shares of the company. Los Angeles Capital Management LLC purchased a new position in Gates Industrial in the fourth quarter worth about $26,000. Transamerica Financial Advisors LLC raised its holdings in shares of Gates Industrial by 51.9% during the fourth quarter. Transamerica Financial Advisors LLC now owns 1,577 shares of the company’s stock valued at $34,000 after purchasing an additional 539 shares during the last quarter. Northwestern Mutual Wealth Management Co. raised its holdings in shares of Gates Industrial by 273.2% during the second quarter. Northwestern Mutual Wealth Management Co. now owns 2,911 shares of the company’s stock valued at $67,000 after purchasing an additional 2,131 shares during the last quarter. Quadrant Capital Group LLC purchased a new position in shares of Gates Industrial during the third quarter valued at approximately $73,000. Finally, EverSource Wealth Advisors LLC raised its holdings in shares of Gates Industrial by 1,976.9% during the second quarter. EverSource Wealth Advisors LLC now owns 2,970 shares of the company’s stock valued at $68,000 after purchasing an additional 2,827 shares during the last quarter. 98.50% of the stock is owned by hedge funds and other institutional investors.

Trending Headlines about Gates Industrial

Here are the key news stories impacting Gates Industrial this week:

• Positive Sentiment: Acquisition announced — Gates agreed to buy The Timken Company’s belts business, expanding its power-transmission footprint and management says the deal should improve adjusted EBITDA margins in the Industrial Motion segment. The strategic fit and expected margin accretion are positive for medium-term profit growth. Timken to Sell Belts Business to Gates
• Positive Sentiment: EPS beat — Gates reported $0.35 EPS for Q1, above the ~$0.32 consensus, showing underlying profitability and providing some support despite revenue pressure. That beat helps justify the multiple while investors assess topline trends. Gates Industrial (GTES) Q1 Earnings Surpass Estimates
• Neutral Sentiment: Guidance roughly in line but cautious on revenue — FY?2026 EPS was guided to $1.52–$1.68 (near Street expectations) while revenue guidance of $3.5–$3.6B sits slightly below consensus. That keeps the story intact but raises questions about near-term top-line momentum. Gates Industrial Reports First-Quarter 2026 Results
• Neutral Sentiment: Conference call / management commentary — The earnings call transcript provides more context on reasons for core revenue weakness and integration plans for the Timken belts assets; investors should watch execution details. Gates Industrial (GTES) Q1 2026 Earnings Call Transcript
• Negative Sentiment: Top-line softness and core revenue decline — Q1 net sales were $851.1M (up 0.4% YoY) but core revenue fell ~2.9% year-over-year and sales missed analyst estimates (~$859.7M). Sluggish organic growth and the revenue miss likely drove the negative stock reaction. Gates Industrial (GTES) Q1 Earnings: How Key Metrics Compare to Wall Street Estimates

Analyst Ratings Changes

A number of equities research analysts have issued reports on GTES shares. Wall Street Zen lowered shares of Gates Industrial from a “strong-buy” rating to a “buy” rating in a report on Saturday, April 18th. Citigroup raised their price target on shares of Gates Industrial from $27.00 to $33.00 and gave the stock a “buy” rating in a report on Friday, February 13th. Robert W. Baird set a $39.00 target price on shares of Gates Industrial in a research report on Friday, February 13th. Morgan Stanley raised their target price on shares of Gates Industrial from $25.00 to $27.00 and gave the stock an “equal weight” rating in a research report on Wednesday, March 11th. Finally, UBS Group reaffirmed a “buy” rating and issued a $33.00 target price on shares of Gates Industrial in a research report on Friday, February 13th. Six research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to data from MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and a consensus price target of $30.36.

About Gates Industrial

Gates Industrial Corporation PLC (NYSE: GTES) is a leading global manufacturer of engineered power transmission belts and fluid power products. The company’s portfolio includes synchronous belts, V-belts, hose assemblies, fittings and hydraulic components designed to support a wide range of industrial and automotive applications. Gates Industrial serves sectors such as agriculture, mining, construction, manufacturing, transportation and consumer markets, offering solutions that improve performance, reliability and efficiency in demanding operating environments.

In its power transmission segment, Gates Industrial produces high-strength belts engineered for precise motion control and minimal maintenance.