Regal Rexnord's 15min chart shows MACD and KDJ death crosses.

Based on Regal Rexnord's 15-minute chart, a MACD Death Cross and KDJ Death Cross have occurred on August 8, 2025 at 14:45. This suggests that the stock price has the potential to continue its downward trajectory, as momentum has shifted towards the downside and may lead to further decreases in the stock price.

Title: Regal Rexnord's Q2 2025 Earnings: Mixed Signals and Market Reaction

Regal Rexnord Corporation (RRX) reported its second-quarter (Q2) 2025 earnings, with adjusted earnings per share (EPS) of $2.48, exceeding analysts' expectations of $2.44. The company's revenue also surpassed projections, reaching $1.5 billion against the anticipated $1.49 billion [1].

Despite the positive earnings report, the stock experienced a decrease of 7.1% in premarket trading, closing at $135, down from the previous close of $145.32. This decline was likely due to a combination of factors, including market sentiment and analysts' concerns about the company's outlook for the second half of 2025.

Organic sales declined by 1.2% year-over-year, reflecting broader industry trends. However, Regal Rexnord has continued to strengthen its position in key sectors such as aerospace, energy, and data centers. The company's adjusted gross margin was 38.2%, up 10 basis points, and free cash flow was $493 million [1].

On the earnings call, CEO Louis Vernon Pinkham reported that the company delivered solid performance in line with expectations on sales and adjusted earnings per share. He emphasized confidence in neutralizing tariff impacts on adjusted 2025 EBITDA and earnings, aiming for adjusted EBITDA margin neutrality in the first half of 2026. Pinkham highlighted that organic sales declined 1.2% year-over-year, citing project timing in metals and mining within IPS and rare earth magnet constraints delaying higher-margin shipments in AMC. These headwinds were offset by strength in residential and commercial HVAC and aerospace [1].

The company also reported significant progress on cross-sell synergies, with $120 million achieved through the end of last year and an additional $50 million expected this year. CFO Robert J. Rehard stated that the second quarter adjusted gross margin was 38.2%, aided by achieving $17 million of cost synergies in the quarter. He also noted the completion of a $400 million accounts receivable securitization program, generating $368.5 million in proceeds to pay down variable bank debt [1].

Regal Rexnord's management remains optimistic about its sales improving and growing at a low single-digit rate in the back half of 2025 and into next year, supported by backlog growth in IPS and AMC. However, the main risk to guidance is a slower recovery in rare earth magnet availability, while potential revenue upside comes from data center wins and a positive ISM turn [1].

Analysts displayed a neutral to slightly positive tone, pressing for clarity on rare earth impacts, margin outlook, and end market recovery but responding positively to management's transparency on backlog and synergies. Management maintained a confident tone in prepared remarks, emphasizing disciplined execution and progress on synergies, but demonstrated some caution regarding rare earth supply and macro uncertainty [1].

Technical Analysis: MACD and KDJ Death Cross

On August 8, 2025, at 14:45, Regal Rexnord's 15-minute chart exhibited a MACD Death Cross and KDJ Death Cross. This suggests that the stock price has the potential to continue its downward trajectory, as momentum has shifted towards the downside and may lead to further decreases in the stock price.

Conclusion

Regal Rexnord's Q2 2025 earnings report showed mixed signals, with positive financial results but a stock price decline due to market sentiment and analyst concerns. The company's management remains confident in its ability to deliver on 2025 targets, supported by robust cross-sell synergies, a growing backlog, and momentum in data center orders. However, the technical analysis indicates a potential downward trend in the stock price. Investors should closely monitor the company's progress and the broader market conditions.

References:
[1] https://seekingalpha.com/news/4480130-regal-rexnord-outlines-250m-cross-sell-synergy-target-as-data-center-orders-fuel-optimism-for