Gates Industrial (NYSE:GTES) Releases Quarterly Earnings Results, Beats Expectations By $0.01 EPS

Gates Industrial (NYSE:GTES) posted its earnings results on Thursday. The company reported $0.38 EPS for the quarter, beating analysts’ consensus estimates of $0.37 by $0.01, Briefing.com reports. Gates Industrial had a return on equity of 10.38% and a net margin of 6.93%.The firm had revenue of $856.20 million during the quarter, compared to the consensus estimate of $853.35 million. During the same period in the prior year, the company earned $0.36 EPS. The company’s quarterly revenue was up 3.2% compared to the same quarter last year. Gates Industrial updated its FY 2026 guidance to 1.520-1.680 EPS.

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

• Gates delivered record adjusted EBITDA dollars and record adjusted EPS of $1.52 in 2025, reduced net leverage to 1.85x, finished the year with ~ $800M cash, and repurchased over $100M of stock in Q4.
• 2026 guide calls for **core sales growth of 1%–4%**, adjusted EBITDA of $775M–$835M and adjusted EPS of $1.52–$1.68 (midpoint ~5% growth), with CapEx ~$120M and 90%+ free cash flow conversion assumed.
• Management highlighted secular wins: Personal Mobility (>25% core growth in 2025 and +28% in Q4) and a rapidly growing data center business (4x YoY orders), with a $100M–$200M ambition by 2028 to drive above-market growth.
• Demand indicators improved exiting 2025—book‑to‑bill was above 1x and January order trends continued the strength, led by industrial OEM orders, supporting cautious optimism for a gradual industrial recovery.
• Near‑term headwinds include an ERP rollout and footprint optimization that will cost ~$30M–$35M (about a 100 bps drag on adjusted EBITDA in H1 2026), plus Q1 revenue/margin pressure from fewer shipping days and transition inefficiencies.

Gates Industrial Trading Up 4.0%

Shares of NYSE:GTES traded up $1.07 during trading hours on Thursday, hitting $27.58. 4,419,058 shares of the company’s stock traded hands, compared to its average volume of 2,620,468. The firm has a market capitalization of $7.12 billion, a P/E ratio of 30.30 and a beta of 1.27. The business has a fifty day moving average price of $22.86 and a 200-day moving average price of $23.80. Gates Industrial has a 1 year low of $14.70 and a 1 year high of $28.13. The company has a debt-to-equity ratio of 0.61, a current ratio of 3.52 and a quick ratio of 2.50.

Hedge Funds Weigh In On Gates Industrial

Large investors have recently bought and sold shares of the business. Xponance LLC grew its position in Gates Industrial by 3.7% in the 4th quarter. Xponance LLC now owns 13,792 shares of the company’s stock valued at $296,000 after acquiring an additional 486 shares during the last quarter. Glenmede Investment Management LP raised its position in Gates Industrial by 0.9% during the 3rd quarter. Glenmede Investment Management LP now owns 55,047 shares of the company’s stock valued at $1,366,000 after purchasing an additional 514 shares in the last quarter. Lido Advisors LLC raised its position in Gates Industrial by 3.8% during the 4th quarter. Lido Advisors LLC now owns 14,069 shares of the company’s stock valued at $302,000 after purchasing an additional 521 shares in the last quarter. Public Employees Retirement System of Ohio lifted its holdings in shares of Gates Industrial by 0.6% in the 3rd quarter. Public Employees Retirement System of Ohio now owns 85,178 shares of the company’s stock worth $2,114,000 after buying an additional 543 shares during the period. Finally, Coldstream Capital Management Inc. grew its position in shares of Gates Industrial by 6.4% during the 3rd quarter. Coldstream Capital Management Inc. now owns 13,439 shares of the company’s stock worth $334,000 after buying an additional 809 shares in the last quarter. Hedge funds and other institutional investors own 98.50% of the company’s stock.

Wall Street Analysts Forecast Growth

A number of equities research analysts recently issued reports on the stock. Weiss Ratings reaffirmed a “hold (c+)” rating on shares of Gates Industrial in a research note on Monday, December 29th. Citigroup reissued a “buy” rating on shares of Gates Industrial in a research note on Monday, January 12th. JPMorgan Chase & Co. decreased their price objective on Gates Industrial from $33.00 to $32.00 and set an “overweight” rating on the stock in a research report on Tuesday, December 16th. Wells Fargo & Company began coverage on Gates Industrial in a report on Thursday, November 13th. They issued an “equal weight” rating and a $23.00 target price for the company. Finally, Wall Street Zen downgraded Gates Industrial from a “strong-buy” rating to a “buy” rating in a research report on Saturday, January 10th. Six analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat, the company has an average rating of “Moderate Buy” and an average price target of $27.09.

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.