Gates Industrial (NYSE:GTES) Posts Earnings Results

Gates Industrial (NYSE:GTES) released its quarterly earnings results on Thursday. The company reported $0.38 EPS for the quarter, beating the consensus estimate of $0.37 by $0.01, Briefing.com reports. Gates Industrial had a net margin of 6.93% and a return on equity of 10.38%. The firm had revenue of $856.20 million during the quarter, compared to analyst estimates of $853.35 million. During the same quarter in the prior year, the firm earned $0.36 EPS. The business’s revenue for the quarter 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 Price Performance

Gates Industrial stock traded up $1.07 during mid-day trading on Thursday, hitting $27.58. The stock had a trading volume of 4,419,058 shares, compared to its average volume of 2,620,468. Gates Industrial has a one year low of $14.70 and a one year high of $28.13. The company has a current ratio of 3.52, a quick ratio of 2.50 and a debt-to-equity ratio of 0.61. The firm has a market capitalization of $7.12 billion, a P/E ratio of 30.30 and a beta of 1.27. The firm’s 50 day moving average is $22.86 and its 200 day moving average is $23.80.

Hedge Funds Weigh In On Gates Industrial

A number of hedge funds have recently made changes to their positions in GTES. Empowered Funds LLC purchased a new stake in Gates Industrial in the 1st quarter worth $381,000. PharVision Advisers LLC increased its holdings in shares of Gates Industrial by 19.5% in the third quarter. PharVision Advisers LLC now owns 10,764 shares of the company’s stock worth $267,000 after purchasing an additional 1,759 shares during the last quarter. CIBC Bancorp USA Inc. bought a new stake in shares of Gates Industrial in the third quarter worth about $265,000. Elevation Point Wealth Partners LLC lifted its position in shares of Gates Industrial by 49.6% in the fourth quarter. Elevation Point Wealth Partners LLC now owns 12,365 shares of the company’s stock worth $265,000 after buying an additional 4,098 shares in the last quarter. Finally, Centaurus Financial Inc. boosted its stake in Gates Industrial by 30.4% during the third quarter. Centaurus Financial Inc. now owns 10,431 shares of the company’s stock valued at $259,000 after buying an additional 2,431 shares during the last quarter. Institutional investors own 98.50% of the company’s stock.

Analysts Set New Price Targets

GTES has been the subject of a number of research reports. Wells Fargo & Company began coverage on shares of Gates Industrial in a report on Thursday, November 13th. They set an “equal weight” rating and a $23.00 target price for the company. Weiss Ratings reissued a “hold (c+)” rating on shares of Gates Industrial in a research report on Monday, December 29th. JPMorgan Chase & Co. decreased their target price on Gates Industrial from $33.00 to $32.00 and set an “overweight” rating on the stock in a report on Tuesday, December 16th. Wall Street Zen downgraded Gates Industrial from a “strong-buy” rating to a “buy” rating in a research report on Saturday, January 10th. Finally, UBS Group cut their price target on Gates Industrial from $29.00 to $28.00 and set a “buy” rating for the company in a report on Monday, January 5th. Six investment analysts have rated the stock with a Buy rating and six have given a Hold rating to the company. Based on data from MarketBeat, Gates Industrial currently has a consensus rating of “Moderate Buy” and a consensus target price 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.