Why Is Regal Rexnord Stock Surging On Tuesday?

Regal Rexnord Corp. (NYSE: RRX ) stock traded higher on Tuesday after Kerrisdale Capital issued a research report announcing a long position in the industrial powertrain leader.

The investment firm highlighted the company’s recent portfolio transformation as a primary catalyst for future growth.

Shift From Cyclicality To Secular Growth According to the Kerrisdale report, the multi-billion-dollar acquisitions of Rexnord’s Process & Motion Control business and Altra Industrial Motion transformed the $15 billion market capitalization company from a legacy heating, ventilation and air conditioning (HVAC)-heavy business into a high-margin motion control leader.

Read Also: Heatwave Strengthens Bullish Case For Utility ETFs, HVAC Stocks Amid Surging Power Demand Data Center Backlog Drives Momentum Kerrisdale stated that the company’s entry into the data center power equipment modules (ePODs) market will drive a financial inflection.

The report noted that Regal entered the ePOD market in early 2025 and exited fourth quarter with $735 million of orders.

Physical AI And Robotics Tailwinds The report emphasized that Regal holds a broad portfolio of motors and linear motion products required for robotics and automation.

These segments currently account for 21% of total revenue, positioning the company to benefit from the expansion of “physical AI” applications.

Significant Valuation Discount Cited Kerrisdale pointed out that Regal trades at 11.5 times 2027 estimate EBITDA, representing a steep discount to its industrial peers.

Outlining an average upside target of 99% across multiple methodologies, the firm stated, “We see Regal shares motoring at least 100% higher.” Critical Levels To Watch for RRX Stock RRX is extended above its key trend gauges, trading 5.2% above the 20-day SMA ($217.41), 8.2% above the 50-day SMA ($211.30), 10.7% above the 100-day SMA ($206.60), and 29.7% above the 200-day SMA ($176.22).

The 20-day SMA above the 50-day SMA keeps the near-term trend pointed up, and the golden cross (50-day above 200-day) that formed in July 2025 continues to support a longer-term bullish structure.

Key Resistance: $236.50 — a nearby ceiling near the stock’s 52-week high zone where rallies can stall Key Support: $201 — a prior demand area that also sits closer to the stock’s intermediate trend zone if momentum cools RRX Stock Price Activity: Regal Rexnord shares were up 5.12% at $231.14 at the time of publication on Tuesday, according to Pro data.

Read Also: Could SanDisk Be The Biggest AI Memory Winner? Bernstein Points To Hidden Advantage Over Micron Image via Shutterstock