Gates Industrial (NYSE:GTES) Posts Quarterly Earnings Results, Beats Estimates By $0.02 EPS

Gates Industrial (NYSE:GTES) announced its quarterly earnings data on Friday. The company reported $0.44 EPS for the quarter, beating analysts’ consensus estimates of $0.42 by $0.02, FiscalAI reports. Gates Industrial had a net margin of 7.23% and a return on equity of 10.00%. The business had revenue of $941.60 million during the quarter, compared to analyst estimates of $925.44 million. During the same quarter in the prior year, the business earned $0.39 earnings per share. The firm’s revenue for the quarter was up 6.6% on a year-over-year basis. Gates Industrial updated its FY 2026 guidance to 1.620-1.700 EPS.

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

• Positive Sentiment: Gates reported record quarterly sales of $942 million, up 6.6% year over year, with core revenue growth of 4.9%, adjusted EBITDA margin of 22.5%, and adjusted EPS up 13% to a record $0.44.
• Positive Sentiment: Broad-based demand improved, led by double-digit industrial OEM growth, approximately 25% growth in personal mobility, 20%+ growth in commercial on-highway, and accelerating APAC and EMEA sales; book-to-bill remained above one.
• Positive Sentiment: Management raised full-year 2026 guidance, including core sales growth of 2.5%-4.5%, adjusted EBITDA of $800 million-$830 million, and adjusted EPS of $1.62-$1.70. The company expects roughly 6% core sales growth and adjusted EBITDA margins of at least 23.5% in the second half.
• Positive Sentiment: Strategic growth initiatives are gaining traction, including personal-mobility belt conversions and data-center applications, where sales more than doubled year over year and are expected to reach $100 million-$200 million by 2028.
• Negative Sentiment: Fluid Power’s adjusted EBITDA margin declined 120 basis points due to footprint realignment and enterprise investments, while oil-related input-cost inflation is persisting; pricing actions are expected to keep the company at least price-cost neutral in the second half.

Gates Industrial Price Performance

Gates Industrial stock opened at $28.01 on Friday. The business’s fifty day moving average is $26.70 and its two-hundred day moving average is $25.38. The company has a debt-to-equity ratio of 0.61, a quick ratio of 2.66 and a current ratio of 3.67. The firm has a market cap of $7.12 billion, a P/E ratio of 29.18 and a beta of 1.25. Gates Industrial has a 52 week low of $20.88 and a 52 week high of $29.17.

More Gates Industrial News

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

• Positive Sentiment: Gates reported second-quarter sales of $941.6 million, up 6.6% year over year, with core sales increasing 4.9%. Revenue exceeded analyst expectations of approximately $925.4 million, indicating solid demand across the business. Gates Industrial Reports Second-Quarter 2026 Results
• Positive Sentiment: Adjusted earnings were $0.44 per share, above the $0.42 analyst consensus and up from $0.39 a year earlier. The company also reported $170.9 million of net income, or $0.67 per diluted share, under its reported accounting measure. Gates Industrial Tops Q2 Earnings and Revenue Estimates
• Positive Sentiment: Gates raised or reaffirmed a favorable FY 2026 adjusted EPS outlook of $1.62 to $1.70, with the midpoint above the current consensus estimate of $1.62. This suggests management expects earnings momentum to continue. Gates Industrial Q2 2026 Earnings Call Transcript
• Neutral Sentiment: Full-year revenue guidance of $3.5 billion to $3.6 billion reaches the consensus estimate only at the upper end; the midpoint is modestly below expectations. Investors may therefore focus on whether stronger core sales can drive results toward the high end of the range. Gates Industrial Earnings Report

Analysts Set New Price Targets

A number of analysts have commented on the company. Robert W. Baird reduced their price objective on Gates Industrial from $39.00 to $37.00 and set an “outperform” rating for the company in a research report on Monday, May 4th. Weiss Ratings restated a “hold (c+)” rating on shares of Gates Industrial in a research report on Monday, June 29th. Morgan Stanley raised their target price on Gates Industrial from $27.00 to $28.00 and gave the stock an “equal weight” rating in a research report on Friday, May 29th. Royal Bank Of Canada increased their price objective on shares of Gates Industrial from $30.00 to $33.00 and gave the company an “outperform” rating in a research note on Thursday, July 16th. Finally, Wolfe Research reissued an “outperform” rating and issued a $33.00 target price on shares of Gates Industrial in a research note on Thursday, July 9th. Seven analysts have rated the stock with a Buy rating and four have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, Gates Industrial currently has a consensus rating of “Moderate Buy” and a consensus target price of $31.50.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in the stock. JPMorgan Chase & Co. boosted its holdings in Gates Industrial by 98.7% in the fourth quarter. JPMorgan Chase & Co. now owns 8,373,294 shares of the company’s stock valued at $179,775,000 after acquiring an additional 4,158,341 shares during the last quarter. Adage Capital Partners GP L.L.C. acquired a new position in Gates Industrial during the 2nd quarter valued at about $32,255,000. Nuveen LLC boosted its stake in shares of Gates Industrial by 280.0% in the 4th quarter. Nuveen LLC now owns 1,725,274 shares of the company’s stock valued at $37,042,000 after purchasing an additional 1,271,248 shares during the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its position in shares of Gates Industrial by 45.9% during the 4th quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 3,939,492 shares of the company’s stock worth $84,581,000 after buying an additional 1,238,766 shares during the period. Finally, Morgan Stanley grew its position in shares of Gates Industrial by 31.6% during the 4th quarter. Morgan Stanley now owns 3,042,742 shares of the company’s stock worth $65,328,000 after buying an additional 730,374 shares during the period. Institutional investors and hedge funds own 98.50% of the company’s stock.

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.