Key Stats
- Current Price: ~$569 (May 15, 2026)
- Q4 FY2026 Revenue: $518M (+18.3% YoY)
- Q4 FY2026 Adjusted EPS: $3.62 (+28% YoY)
- Q4 FY2026 GAAP EPS: $2.89 (+26% YoY)
- Full-Year FY2026 Net Income: $287.6M (+23% YoY)
- Full-Year FY2026 Diluted EPS: $9.09 (+18% YoY)
- Q1 FY2027 Revenue Guidance: $500M to $510M (+15% to +17% YoY)
- Q1 FY2027 Adjusted Gross Margin Guidance: 45.25% to 45.5%
- TIKR Model Price Target: $783
- Implied Upside: ~38%
RBC Bearings Stock: Earnings Breakdown
RBC Bearings stock (RBC) reported Q4 FY2026 net sales of $518M, up 18.3% year-over-year, with adjusted diluted EPS of $3.62, up 28% from $2.83 in the prior-year period.
The Aerospace and Defense segment drove the result, with A&D sales rising 41.2% year-over-year.
Excluding the VACCO acquisition completed in July 2025, organic A&D growth was 22.8%, which, according to Dr. Mike Hartnett, Chairman, President and CEO on the Q4 FY2026 earnings call, reflected “continued momentum” across defense and commercial aircraft markets.
VACCO contributed $30M of Q4 net sales, adding exposure to liquid-propulsion fuel management components across programs including the Tomahawk.
For the full year, A&D grew 32% (19.1% organic), with defense up 65.4% and commercial aircraft up 17.8%, while space revenue reached $70M, up from just $4M in 2021.
The Industrial segment posted OEM growth of 7.8% and distribution growth of 4.5% in Q4.
Adjusted EBITDA rose 21% to $169M in Q4, representing 32.6% of sales.
RBC Bearings paid down $116M of debt during Q4 and guided for full term loan payoff by November 2026.
Full-year free cash flow reached $343M with 119% conversion, up from $244M and 99% conversion in FY2025.
For Q1 FY2027, management guided revenue of $500M to $510M (14.7% to 17% growth year-over-year), with adjusted gross margin at 45.25% to 45.5%.
According to CFO Rob Sullivan on the Q4 FY2026 earnings call, the company expects to expand consolidated gross margins by approximately 50 basis points for the full FY2027 year.
Roughly 60% of commercial OEM long-term agreements have been repriced to reflect post-COVID inflation, with the remaining 40% set to reprice effective January 2027.
Dr. Hartnett stated on the earnings call the company is targeting a doubling of marine revenues over the next 24 to 36 months, driven by Virginia and Columbia class submarine production ramps.
RBC Bearings Stock: Financials
The income statement tells a clean operating leverage story: revenue has accelerated in each of the last four quarters while operating income has expanded in step, confirming the margin recovery that began in mid-FY2026 is holding.
Revenue grew from $436M in Q1 FY2026 to $455M in Q2, $462M in Q3, and $518M in Q4, with YoY growth accelerating from 7% to 14% to 17% to 18%, while gross margin held in a steady 44% to 45% range throughout.
Operating income climbed from $104M in Q1 to $119M in Q4, with operating margins at 23.9%, 22.3%, 22.4%, and 22.9% respectively.
On the earnings call, Sullivan noted A&D adjusted gross margins were 44.2% in Q4 (43.7% ex-VACCO), while Industrial adjusted margins came in at 46.2%, confirming Industrial remains the higher-margin book even as A&D scales.
SG&A also rose to $86.9M in Q4, or 16.8% of net sales, driven by higher stock compensation and personnel costs, with Sullivan guiding SG&A above $80M per quarter going forward.
What Does the Valuation Model Say?
The TIKR model prices RBC Bearings stock at $783, implying approximately 38% upside from the May 15 close of ~$569.
The mid-case assumes a revenue CAGR of 9.2% and a net income margin of 21.4%, compared to a 1-year historical revenue growth rate of 14.3% and a current net income margin of 18.6%.
A&D momentum, a $2.3B backlog, the LTA repricing arriving in January 2027, and the November 2026 debt payoff all support the margin expansion the model requires.
The 7% sell-off widened the gap between price and model target, making RBC Bearings stock a more compelling setup than it was 24 hours earlier, and the investment case is stronger after this report, not weaker.
RBC Bearings delivered a record quarter and guided for double-digit growth in Q1, yet the stock fell 7%, signaling the market sees execution risks the headline numbers do not resolve.
What Has to Go Right
- A&D momentum must sustain: the segment posted 41.2% growth in Q4 with a $2.3B backlog, and management is guiding commercial aerospace growth beyond 15% for FY2027, with defense and space expected to grow faster
- The remaining 40% of LTA repricing must arrive as guided in January 2027, representing the structural tailwind needed to support the 50-basis-point gross margin expansion Sullivan outlined for FY2027
- Marine revenue must scale as planned: Dr. Hartnett committed to doubling marine revenues over 24 to 36 months, requiring capacity additions across equipment, floor space, and test labs
- VACCO margins must normalize to mid-30s after Sullivan flagged the Q4 adjusted margin above 46% as a one-time mix benefit
What Could Still Go Wrong
- SG&A came in at $86.9M in Q4 (16.8% of net sales), with Sullivan guiding above $80M per quarter; if revenue growth moderates, cost leverage becomes a headwind
- Dr. Hartnett described commercial aerospace aftermarket as “on the bubble” through April and May, adding uncertainty to a book leveraged primarily to engines
- Titanium is a flagged watch item, high alloy steel is available only at elevated prices, and aluminum is under observation as A&D scales across multiple simultaneous program ramps
- The 40% of LTA contracts still at pre-inflation pricing limits near-term margin upside through at least H1 FY2027, creating a gap between current margins and what the model projects at full reprice
Should You Invest in RBC Bearings Incorporated?
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