Gates Industrial (GTES) has just put fresh numbers on the board, with recent quarters showing revenue around US$856 million in Q4 2025 and basic EPS of about US$0.20, alongside trailing 12 month EPS of roughly US$0.98. Over the past six reported quarters, revenue has ranged from US$829.4 million to US$883.7 million, while quarterly basic EPS has moved between about US$0.14 and US$0.32. This gives you a clear view of how the top line and per share earnings have tracked into the latest release. For investors, the key question now is how the current margin profile and earnings power shape the risk and reward trade off around this update.

See our full analysis for Gates Industrial.

With the headline figures on the table, the next step is to set these results against the widely held narratives around Gates Industrial to see which views align with the numbers and which may need a rethink.

28.5% earnings growth with 7.3% margin

• Over the last 12 months, net income reached US$252.2 million on US$3.4b of revenue, giving a 7.3% net margin alongside 28.5% earnings growth.
• Consensus narrative points to demand in data centers and personal mobility as key growth drivers. The current 7.3% margin and trailing 12 month EPS of about US$0.98 give concrete earnings power that supports that view, yet:
  • The forecast revenue growth of about 4% a year is lower than the 11% outlook mentioned for the broader US market, which is slower than the growth story some bulls have in mind.
  • Analysts expect earnings to grow about 14.1% a year, which is solid but still below the 15.8% figure cited for the wider market, so the margin progress needs to keep doing more of the heavy lifting for the bullish case.

To see how bullish investors connect these margin and earnings trends to Gates Industrial's future, check out the 🐂 Gates Industrial Bull Case.

P/E of 24.3x versus machinery peers

• At a share price of US$24.06, the trailing P/E is 24.3x, compared with 27.8x for the US Machinery industry and 54.2x for the peer group. A DCF fair value of about US$35.23 sits well above the current price alongside an analyst consensus target of US$31.58.
• Bears argue that slower top line expectations justify this discount, and the numbers give them some backing, because:
  • Revenue is forecast to grow about 4% a year, which is well below the 11% rate cited for the broader US market, so valuation could stay at a discount if that gap persists.
  • Bearish analysts also assume earnings growth and margin expansion to around 9.4% by 2029, yet still see room for the P/E to compress from current levels, which lines up with the idea that revenue momentum may not fully support higher multiples.

Skeptics who focus on these slower growth assumptions set out a more cautious path for the shares in the 🐻 Gates Industrial Bear Case.

Quarterly EPS swings against steadier LTM trend

• Quarterly basic EPS over the last six reported periods moved between about US$0.14 and US$0.32, yet on a trailing 12 month basis sits at roughly US$0.98, backed by TTM net income of US$252.2 million on US$3.4b of revenue.
• Consensus narrative suggests that stronger segments like data center liquid cooling and personal mobility can smooth through softer industrial and automotive markets over time. The data partly lines up with that, since:
  • Record adjusted EPS of US$1.52 cited for 2025, alongside high free cash flow conversion near 92%, shows that even with some softer end markets, overall profitability has held up well.
  • At the same time, exposure to slower or flat industrial OEM and automotive channels and a Fluid Power segment facing weaker demand underline why forecasts still only point to about 3.8% to 4% annual revenue growth rather than something closer to high growth peers.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Gates Industrial on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

Do these numbers leave you feeling confident or cautious about Gates Industrial? Take a closer look now and weigh those views against the 5 key rewards.

See What Else Is Out There

Gates Industrial is working with relatively modest forecast revenue growth of about 4% a year, slower than the 11% outlook cited for the broader US market.

If that slower top line leaves you wanting stronger growth potential, compare this setup with companies in the screener containing 25 high quality undiscovered gems to spot ideas with more punch.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.