Why Has Gates Industrial Stock Rallied 40% Over The Last 3 Months?

November 19th, 2019 by Trefis Team

Gates Industrial (NYSE: GTES), a manufacturer of power transmission and fluid power solutions, has seen its stock price rise by more than 40% over the last 3 months. The rally is driven partly by the company’s Q3 earnings beat, with the company posting an adjusted EPS of $0.22, about $0.06 ahead of the consensus. While concerns of an economic slowdown and trade-related uncertainty have weighed on the broader industrial sector, with customers focusing on reducing inventory and scaling back on orders, Gates’ stronger than expected earnings could indicate that the company is seeing some stabilization.

We ‘step back’ from these recent swings to review Gates Industrial’s performance over the last few years, as a context for what might come next. Our Interactive dashboard, Why Has Gates Industrial Stock Rallied 40% Over The Last Quarter? reviews the near term reasons and the big picture.

The context for the last few years:

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A closer look At Gates Industrial’s Total Revenues over the last few years and the outlook

Total Revenues for Gates Industrial increased from $3.04 Bil in 2017 to $3.35 Bil in 2018; an increase of 10.1%. This compares with Total Revenues growth of 10.7% in 2017. We expect Total Revenues growth to be -7.4% in 2019.

A closer look At Gates Industrial’s Total Expenses over the last few years and the outlook

Total Expense for Gates Industrial slightly increased from $2.93 Bil in 2017 to $3.04 Bil in 2018; an increase of 3.82%. This compares with Total Expense growth of 10.5% in 2017. We expect Total Expense growth to be -4.7% in 2019.

 

How does Gates Industrial’s Revenue Growth compare with rivals?

For more details on how Gates Industrial’s Revenue growth compares with ABB and Timken, view our interactive dashboard analysis.

How has  Gates Industrial’s EBT trended?

EBT for Gates Industrial increased dramatically by 177% from $110 Mil in 2017 to $304 Mil in 2018. We expect EBT to decline by -34% in 2019.

How has Gates Industrial’s Net Income and EPS trended?

For more information on Gates Industrial’s Net Income and EPS, view our interactive dashboard analysis.

 

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