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Summary:
RBC Bearings' reported strong second-quarter fiscal 2015 results. Earnings came in at $0.70 per share, up 9.4% year over year. Revenues grew 10.4% on the back of higher demand for its industrial OEM products. However, at the end of the first six months of fiscal 2015, the company's backlog stood at $217.9 million, down 2% from the year-ago value. We believe the company's solid product portfolio would help it to capitalize on the rising demand in aerospace and industrial end markets in the quarters ahead. Also, acquisitions will add to the company's inorganic growth. However, RBC Bearings' international operations expose it to various geo-political and economic risks. In addition, usage of steel as the main raw material remains a potential headwind. Based on these factors, we maintain a Neutral recommendation on the stock.
Overview:
Headquartered in Oxford, CN, RBC Bearings Incorporated manufactures and distributes plain, roller and ball bearings. These bearings are tools that reduce damage and energy loss, and enable proper power transmission in the majority of machines and mechanical systems.
RBC Bearings offers its products to various customers, classified under two categories, viz. (i) diversified industrial and (ii) aerospace and defense. Diversified industrial market accounted for roughly 42% of net sales in fiscal 2014, whereas aerospace and defense market contributed the remaining 58%. The company conducts its operations in regions including the U.S., Mexico, France, Switzerland, China and England.
RBC Bearings' operations are divided into four segments, each of which is discussed below:
Plain Bearings: RBC Bearings offers a range of plain bearings, mainly to the aerospace industry, which are qualified as per various customer design and performance standards. These bearings are used to correct misalignments in diverse mechanical machineries. They are further classified into rod end bearings, spherical plain bearings and journal bearings.
Roller Bearings: Roller bearings are elements which carry a load using cylindrical rolling elements. RBC offers a variety of roller bearings like tapered roller bearings, used in heavy truck axle operations needle roller bearings, used in industrial and aircraft applications along with needle bearing track rollers and cam followers which are used in industrial markets.
Ball Bearings: Ball bearings are elements which reduce friction using ball elements. RBC manufactures four types of ball bearings high precision aerospace bearings used in the defense industry airframe control ball bearings, used for military purposes thin section ball bearings, used in machinery manufacturing and industrial ball bearings, used in the aftermarket.
Other: This segment of RBC Bearings consists primarily of collets, used as the means to hold a work piece or a tool and precision ball screws, mainly used in aircraft and missiles.
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| Product Model | Inside Diameter | Outside Diameter | Thickness |
| 23084BK NTN | 420 | 620 | 150 |
| 23084B NTN | 420 | 620 | 150 |