This Under-the-Radar Industrial Is Quietly Powering AI

Regal Rexnord's stock has risen about 51% this year, driven by surging data-center orders that pushed AMC segment orders up more than 34% year-over-year.

First-quarter 2026 results beat expectations, with sales of $1.48 billion and daily orders up 8.5%, prompting management to raise its full-year sales growth outlook to about 4.5%.

Risks including a declining adjusted EBITDA margin, rising short interest, and a leadership transition temper the bullish case despite strong recent performance.

Regal Rexnord NYSE: RRX has spent decades making motors and power-transmission components for factories. It still does. But it also makes automation and motion-control components for data centers. And its stock is up about 50% this year as orders flood in.

Analysts rate the company a Moderate Buy by consensus, with most suggesting a Buy. But a rich multiple, rising short interest, and leadership transition do not make this recent winner necessarily low-risk.

AI Data Centers Are Driving Demand At its core, Regal Rexnord is a maker of industrial powertrain systems, motion control technology, and power management solutions. In other words, it makes the mechanical and electrical components that move, control, and regulate energy inside machines. For years, its products went into factories, HVAC systems, agricultural equipment, and commercial infrastructure. More recently, though, cloud companies and AI developers began building data centers at a breakneck pace, and...