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Regal Rexnord earnings quality score

How much of the reported profit is backed by cash, and how many markers of managed earnings the filings show

Score74 / 100 · grade B · rank 196 of 1027

Regal Rexnord (RRX) scores 74 of 100 for earnings quality, grade B: rank 196 of 1027 companies and 31 of 287 in industrials. It loses the most points on adjusted earnings 67% below GAAP, accruals of -5.1% of assets, lower than 59% of companies (profit backed by cash), Montier C-score 2 of 5 checks failed. It earns full or near-full marks for Piotroski F-score 8 of 9, discretionary accruals of +0.4% of assets (modified Jones), smaller than most, Beneish M-score -3.06: clean (below −2.22).

What earned and lost points

ComponentWhat the filings showPointsOf
Accrualsaccruals of -5.1% of assets, lower than 59% of companies (profit backed by cash)1220
Beneish M-scoreBeneish M-score -3.06: clean (below −2.22)1515
Dechow F-scoreDechow F-score 0.58 (normal)1515
Montier C-scoreMontier C-score 2 of 5 checks failed915
Discretionary accrualsdiscretionary accruals of +0.4% of assets (modified Jones), smaller than most910
Piotroski F-scorePiotroski F-score 8 of 9910
Non-GAAP gapadjusted earnings 67% below GAAP010
Earnings smoothnessprofit about as variable as cash flow (smoothness 0.81)55
RRX: share of the available points, by componentRRX: share of the available points, by componentAccruals59%Discretionary accruals92%Beneish M-score100%Dechow F-score100%Montier C-score60%Piotroski F-score89%Earnings smoothness100%

How the score is built

Eight published measures, each scored against the whole universe or on its own scale and weighted: accruals 20, discretionary accruals 10, Beneish M 15, Dechow F 15, Montier C 15, Piotroski F 10, the non-GAAP gap 10, smoothness 5. A measure that cannot be computed (Beneish for a bank, say) drops out and the rest is rescaled, so every company is scored on what applies to it.

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Computed from the companies’ own XBRL filings (latest fiscal year) by published formulas; a statistical screen, not an audit or an accusation. A low score means the reported profit shows more of the markers of managed or low-quality earnings than its peers. Not investment advice.