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Knorr-Bremse AG
(XETRA:KBX)
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Rating:71Outperform
Price Target:
€114.00
▲(7.24% Upside)
Action:Upgraded
Date:08/03/26
The score is driven primarily by solid financial performance (strong growth and free cash flow, improving debt levels) and a notably upbeat earnings update with raised guidance and margin/ROCE improvement. Offsetting factors are a less attractive valuation (P/E ~28.35 with a modest ~1.85% yield) and mixed near-term technical signals, plus margin-quality uncertainty flagged in the financial statements.
Positive Factors
Free cash flow generation
Sustained near‑billion euro FCF and strong multi‑year rebound give durable capacity to fund debt reduction, disciplined capex (3–5% targets), dividends and selective M&A. High FCF/NI (~0.75) indicates earnings quality and long‑term financial flexibility versus peers.
Negative Factors
Unusual gross margin volatility
A steep, unexplained TTM gross‑margin fall markedly departs from historical ranges, raising concerns over cost pressure, product mix shifts or one‑off reporting items. This undermines confidence in sustainable margin assumptions and complicates medium‑term profit forecasting.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Sustained near‑billion euro FCF and strong multi‑year rebound give durable capacity to fund debt reduction, disciplined capex (3–5% targets), dividends and selective M&A. High FCF/NI (~0.75) indicates earnings quality and long‑term financial flexibility versus peers.
Read all positive factors
Knorr-Bremse AG (KBX) vs. iShares MSCI Germany ETF (EWG)
Market Cap
€16.59B
Dividend Yield1.85%
Average Volume (3M)156.00K
Price to Earnings (P/E)28.3
Beta (1Y)1.13
Revenue Growth1.11%
EPS Growth38.64%
CountryDE
Employees30,913
SectorConsumer Cyclical
Sector Strength84
IndustryIndustrial - Capital Goods
Share Statistics
EPS (TTM)3.63
Shares Outstanding161,200,000
10 Day Avg. Volume150,031
30 Day Avg. Volume155,999
Financial Highlights & Ratios
PEG Ratio1.47
Price to Book (P/B)5.29
Price to Sales (P/S)2.10
P/FCF Ratio19.75
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
€117.50Price Target Upside10.54% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)4.62
Revenue Forecast (FY)€8.29B
Knorr-Bremse AG Business Overview & Revenue Model
Company Description
Knorr-Bremse Aktiengesellschaft is a global enterprise specializing in the development, manufacture, sale, and maintenance of crucial braking and other operational systems for both rail and commercial vehicles worldwide. The company structures its...
How the Company Makes Money
Knorr-Bremse makes money mainly by selling mission-critical systems and components to vehicle manufacturers and by generating recurring revenue from the installed base of vehicles already in operation.
1) OEM (new vehicle) business: A significant...
Knorr-Bremse AG Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 29, 2026
Earnings Call Sentiment Positive
The call emphasized multiple clear operational and financial improvements: stronger-than-expected organic growth, notable margin expansion (reaching midterm targets), sizable free cash flow gains, a healthier backlog in rail, successful portfolio disposals and a disciplined capital allocation framework. Management acknowledged remaining challenges — notably uneven rail order intake quarter-to-quarter, persistent truck market headwinds, FX impacts, and a small number of underperforming investments requiring remediation — but presented a defined next‑phase strategy (Growth Beyond) and concrete 2030 targets. On balance, positive execution and upgraded guidance outweigh the listed headwinds.Positive Updates
Group revenue growth and upgraded guidance
Group revenues of EUR 2.1 billion in Q2 with organic growth of more than 6% year‑on‑year. Management increased full‑year 2026 guidance to EUR 8.1–8.3 billion in revenues and raised the operating EBIT margin guidance to 14.0%–14.5%.
Negative Updates
RVS quarterly order intake decline
RVS order intake decreased ~12% in Q2 to ~EUR 1.14 billion, producing a book‑to‑bill of 0.96 for the quarter (management highlights rail is lumpy and backlog remains strong).
Read all updates
Q2-2026 Updates
Positive
Negative
Group revenue growth and upgraded guidance
Group revenues of EUR 2.1 billion in Q2 with organic growth of more than 6% year‑on‑year. Management increased full‑year 2026 guidance to EUR 8.1–8.3 billion in revenues and raised the operating EBIT margin guidance to 14.0%–14.5%.
Read all positive updates
Company Guidance
Management raised 2026 guidance and set detailed mid‑term targets: for 2026 they now expect revenues of EUR 8.1–8.3bn, an operating EBIT margin of 14.0–14.5% and free cash flow of EUR 750–850m (management expects the upper end); Q2 metrics included order intake >EUR 2.2bn, group revenues EUR 2.1bn (+≈6% organic), operating EBIT margin 14.2% (up 110bp YoY), Q2 free cash flow EUR 262m (H1 EUR 294m), CapEx EUR 70m (3.3% of revenues), net working capital EUR 1.43bn (63 days) and ROCE 23.8% (+250bp YoY). Division guidance: RVS Q2 revenues EUR 1.18bn (organic ≈5%), OE EUR 557m, aftermarket EUR 628m, backlog >EUR 5.9bn and a full‑year RVS margin target of ~17.5%; Truck (CVS) Q2 revenues EUR 959m (organic +8%), order intake EUR 1.06bn (book‑to‑bill 1.11) and full‑year organic revenue growth guided to low‑ to mid‑single digits with an EBIT margin target of ~12% (Q3 order intake ~EUR 1bn). For 2030 they target ~EUR 10bn organic revenues, group operating EBIT margin ≈16% (RVS ≈20%, CVS ~12–14%), ROCE >25%, cash conversion >90%, R&D ~6% of revenues, CapEx 4–5% and a dividend payout ratio around 50% of net income.Knorr-Bremse AG Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
66
Positive
Cash Flow
77
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.96B | 7.82B | 7.88B | 7.93B | 7.15B | 6.71B |
| Gross Profit | 1.16B | 1.69B | 4.24B | 4.02B | 3.52B | 3.45B |
| EBITDA | 1.36B | 1.26B | 1.11B | 1.21B | 1.05B | 1.21B |
| Net Income | 585.00M | 534.00M | 445.00M | 552.53M | 489.28M | 621.31M |
Balance Sheet | ||||||
| Total Assets | 9.47B | 9.21B | 9.63B | 8.25B | 8.01B | 7.20B |
| Cash, Cash Equivalents and Short-Term Investments | 1.22B | 1.74B | 2.26B | 1.29B | 1.45B | 1.44B |
| Total Debt | 3.19B | 3.08B | 4.03B | 2.76B | 2.68B | 2.15B |
| Total Liabilities | 6.17B | 6.03B | 6.50B | 5.35B | 5.32B | 4.77B |
| Stockholders Equity | 3.20B | 3.10B | 3.04B | 2.84B | 2.56B | 2.33B |
Cash Flow | ||||||
| Free Cash Flow | 935.00M | 831.00M | 696.00M | 539.43M | 189.41M | 579.96M |
| Operating Cash Flow | 1.19B | 1.07B | 1.04B | 914.59M | 541.55M | 975.49M |
| Investing Cash Flow | -869.00M | -380.00M | -750.30M | -410.64M | -505.00M | -534.37M |
| Financing Cash Flow | -422.00M | -1.13B | 629.10M | -397.67M | -160.81M | -1.42B |
Knorr-Bremse AG Technical Analysis
Positive
106.30
Price Trends
102.79
Positive
101.08
Positive
97.21
Positive
Market Momentum
0.75
Negative
55.67
Neutral
49.19
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:KBX, the sentiment is Positive. The current price of 106.3 is above the 20-day moving average (MA) of 103.69, above the 50-day MA of 102.79, and above the 200-day MA of 97.21, indicating a bullish trend. The MACD of 0.75 indicates Negative momentum. The RSI at 55.67 is Neutral, neither overbought nor oversold. The STOCH value of 49.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:KBX.
Knorr-Bremse AG Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | €16.59B | 28.35 | 17.95% | 1.79% | 1.11% | 38.64% | |
70 Outperform | €978.25M | 16.71 | 11.98% | 3.11% | -4.59% | -8.81% | |
62 Neutral | €14.37B | -435.52 | -0.76% | 3.81% | -44.98% | -102.56% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | €7.86B | 68.64 | 3.07% | 0.31% | -1.39% | -39.91% | |
50 Neutral | €306.66M | 65.58 | 0.83% | 3.11% | -6.42% | ― | |
43 Neutral | €6.70B | -15.20 | -14.78% | 3.76% | 16.50% | 57.62% |
* Consumer Cyclical Sector Average
DE:KBX
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.