Robert W. Baird analyst Tristan Gerra has maintained their bullish stance on KN stock, giving a Buy rating yesterday.
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Tristan Gerra has given his Buy rating due to a combination of factors including Knowles’ strong end-market exposure and healthy demand trends. The company benefits from its involvement in medtech and defense sectors, which are less affected by economic cycles, along with steady industrial demand. Additionally, the company’s Precision Devices segment showed a robust book-to-bill ratio of 1.18 in the second quarter, indicating strong demand across various markets and providing solid visibility into the third quarter.
Furthermore, Knowles is experiencing improving utilization rates and expects to maintain sequential gross margin growth into the fourth quarter. The company’s management anticipates that orders for Precision Devices will be at the higher end of their organic CAGR guidance due to new production capabilities. The normalization of industrial inventories and minimal impact from tariffs also contribute to the positive outlook. Knowles’ recent financial performance, including a 10.4% quarter-over-quarter revenue increase and a pro forma gross margin improvement, supports the Buy rating, along with a raised price target of $25.
Based on the recent corporate insider activity of 53 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of KN in relation to earlier this year.