Kimball Electronics (KE) AI Stock Analysis

• Market Cap: $565.64M
• Dividend Yield: N/A
• Average Volume (3M): 180.21K
• Price to Earnings (P/E): 47.1
• Beta (1Y): 1.30
• Revenue Growth: -10.46%
• EPS Growth: 88.34%
• Country: US
• Employees: 7,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 0.28
• Shares Outstanding: 24,214,134
• 10 Day Avg. Volume: 141,921
• 30 Day Avg. Volume: 180,211
• PEG Ratio: -1.64
• Price to Book (P/B): 0.84
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 3.17
• Enterprise Value/Market Cap: 1.14
• Enterprise Value/Revenue: 0.44
• Enterprise Value/Gross Profit: 5.64
• Enterprise Value/Ebitda: 7.57
• 1Y Price Target: $31.00
• Price Target Upside: 33.22% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 1.35
• Revenue Forecast (FY): $1.40B

• Rating: 61 Neutral
• Price Target: $24.50 ▲(5.29% Upside)
• Action: Reiterated Date: 02/07/26
• Date: Action: Reiterated 02/07/26

The score is driven primarily by mixed financial performance (thin margins and slightly declining TTM revenue, but solid recent free cash flow and improved leverage). The latest earnings call is a positive offset due to raised FY2026 guidance and improving margins/cash flow, while weak technical momentum and a relatively high P/E for the company’s current profitability keep the overall score in the low 60s.

Positive Factors

Strong free cash flow and improved liquidity

Sustained positive operating cash flow (eight consecutive quarters) and sizable recent FCF provide durable internal funding for capex, CMO ramps, debt reduction and selective buybacks. Strong liquidity reduces refinancing risk and supports investments that can improve margins and long-term competitiveness.

Expanding medical CMO capacity and capabilities

Adding large onshore medical CMO capacity targets a higher-growth, higher-margin end market and strengthens customer stickiness through integrated manufacturing and innovation. This structural shift helps diversify revenue mix and capture secular healthcare demand across regulated products and services.

Raised FY2026 guidance and margin improvement trend

Management's upward guidance and material gross margin improvement indicate operational execution and better mix (notably medical). If sustained, higher operating margins expand cushion against cost swings and support reinvestment in capacity and R&D, improving long-term earnings durability.

Negative Factors

Thin margins and modest profitability

Margins remain thin in a contract-manufacturing model where pricing and component cost pressures are common. Low net margins leave limited room for error from input cost swings, program delays or competitive pricing, constraining durable free-cash flow expansion and ROI on new investments.

End-market concentration and Automotive weakness

Heavy reliance on automotive exposes the business to cyclicality, program transitions, tariffs and regional softness (China, North America). A single vertical near half of revenue raises the risk that prolonged auto weakness materially depresses revenue, utilization and margins over multiple quarters.

Near-term ramp costs and historical cash volatility

New facility ramps increase short-term overhead, working-capital needs and depreciation, pressuring margins until utilization improves. Combined with a history of volatile cash flow in down cycles, this raises execution risk: prolonged ramps or demand softness can depress returns and strain funding flexibility.

Kimball Electronics Business Overview & Revenue Model

Company Description

Kimball Electronics, Inc. provides contract electronics manufacturing services and diversified manufacturing services to customers in the automotive, medical, industrial, and public safety end markets. The company's manufacturing services include design services and support, supply chain services and support, and rapid prototyping and product introduction support services, as well as product design, and process validation and qualification services. Its manufacturing services also comprise industrialization and automation of manufacturing processes; reliability testing, including testing of products under a series of environmental conditions; production and testing of printed circuit board assemblies; assembly, production, and packaging of medical devices and disposables, and other non-electronic products; drug delivery devices and solutions with and without electronics; design engineering and manufacturing of automation equipment, test and inspection equipment, and precision molded plastics; software design services; and product life cycle management services. The company operates in the United States, China, Mexico, Poland, Romania, Thailand, and Vietnam. Kimball Electronics, Inc. was founded in 1961 and is headquartered in Jasper, Indiana.

How the Company Makes Money

Kimball Electronics makes money primarily by selling manufacturing and related services to OEM customers under contract, recognizing revenue when it produces and delivers electronic assemblies and finished products that meet customer specifications. Key revenue streams typically include: (1) electronics manufacturing services—charging customers for the build of printed circuit board assemblies and higher-level assemblies (labor, overhead, manufacturing execution, and process engineering) and earning a margin on those services; (2) materials and component procurement—sourcing components on behalf of customers, incorporating those materials into finished goods, and generating revenue that includes reimbursement for materials plus a contracted margin/markup or embedded margin in the overall product price; (3) value-added services—engineering support, testing, quality/regulatory support (especially in medical and automotive), and new product introduction/industrialization services that help customers ramp production and sustain products over their life cycle. The company’s earnings are influenced by production volumes from existing programs, successful wins and ramps of new programs, the mix of higher-value assemblies vs. lower-complexity builds, operational efficiency/yield, and its ability to manage supply-chain availability and component cost volatility while meeting contractual pricing terms. Information on specific customer partnerships, named customers, or the exact contractual fee structures used (e.g., cost-plus vs. fixed-price by program) is null.

Kimball Electronics Financial Statement Overview

Summary

Overall fundamentals are mixed: revenue is slightly down in TTM and margins remain thin (gross ~7.4%, net ~1.6%), limiting return potential. Offsetting this, recent cash generation is solid (TTM FCF $110M) and leverage appears improved versus prior years (debt-to-equity ~0.24–0.26).

Income Statement

TTM (Trailing-Twelve-Months) revenue is slightly down (-1.09%) versus the prior period, extending a softer top-line trend after prior declines, which weighs on the outlook. Profitability is positive but thin: TTM gross margin is ~7.4% and net margin is ~1.6%, indicating limited room for error in a cost-sensitive manufacturing model. Earnings improved from the weaker FY2025 level (annual net margin ~1.1%) but remain well below the stronger FY2023–FY2021 period when margins were materially higher.

Balance Sheet

Leverage appears moderate-to-improving versus the last few fiscal years, with the debt-to-equity ratio around 0.24–0.26 in the most recent periods (TTM and FY2025), down from ~0.54 in FY2024–FY2023. Returns on equity are positive but modest recently (TTM ~4.3% and FY2025 ~3.0%) versus stronger historical levels (e.g., FY2023 ~10.7% and FY2021 ~12.8%), suggesting profitability, rather than balance sheet structure, is the main limiter. Note: the TTM snapshot lists total debt and equity as 0, so the leverage assessment relies primarily on the provided debt-to-equity and ROE figures.

Cash Flow

Cash generation is a relative strength: TTM operating cash flow is $124M and free cash flow is $110M, following very strong FY2025 free cash flow of $150M. That said, free cash flow growth is slightly negative in TTM (-4.76%), and the company has shown meaningful volatility historically, including negative operating and free cash flow in FY2023 and FY2022. Overall, recent cash conversion is solid, but the track record suggests sensitivity to working-capital swings and/or cycle-driven demand shifts.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	1.46B	1.49B	1.71B	1.82B	1.35B	1.29B
Gross Profit	114.23M	104.40M	140.26M	156.16M	104.60M	118.03M
EBITDA	85.15M	77.97M	86.07M	123.42M	75.80M	106.24M
Net Income	24.12M	16.98M	20.51M	55.83M	31.25M	56.79M
Balance Sheet
Total Assets	1.08B	1.08B	1.21B	1.26B	1.04B	814.06M
Cash, Cash Equivalents and Short-Term Investments	77.85M	88.78M	77.97M	42.95M	49.85M	106.44M
Total Debt	153.81M	147.05M	294.84M	281.45M	180.58M	66.21M
Total Liabilities	504.31M	507.43M	667.46M	735.73M	581.80M	372.09M
Stockholders Equity	579.16M	569.88M	540.46M	523.99M	453.97M	441.97M
Cash Flow
Free Cash Flow	110.30M	150.26M	27.14M	-104.49M	-157.89M	90.74M
Operating Cash Flow	123.95M	183.94M	73.22M	-13.80M	-83.18M	130.09M
Investing Cash Flow	-37.85M	-14.70M	-46.52M	-90.47M	-74.80M	-38.80M
Financing Cash Flow	-65.76M	-160.87M	8.97M	99.18M	103.74M	-53.08M

Kimball Electronics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 23.27
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KE, the sentiment is Negative. The current price of 23.27 is below the 20-day moving average (MA) of 24.25, below the 50-day MA of 26.92, and below the 200-day MA of 25.93, indicating a bearish trend. The MACD of -1.11 indicates Negative momentum. The RSI at 39.39 is Neutral, neither overbought nor oversold. The STOCH value of 50.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KE.

Kimball Electronics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ESP	82 Outperform	$165.04M	11.56	19.09%	3.00%	4.90%	31.13%
PLPC	71 Outperform	$1.24B	28.81	7.68%	0.35%	15.93%	12.72%
ULBI	64 Neutral	$115.38M	-16.14	-4.35%	―	12.94%	-81.09%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
KE	61 Neutral	$565.64M	47.05	4.24%	―	-10.46%	88.34%
SKYX	54 Neutral	$231.47M	-4.12	-703.65%	―	7.06%	12.25%
AIRJ	47 Neutral	$224.56M	-17.67	-0.34%	―	―	-100.27%

Kimball Electronics Corporate Events

Kimball Electronics Unveils New Indianapolis Medical Manufacturing Facility

On January 8, 2026, Kimball Electronics announced it will hold a ribbon-cutting ceremony on February 6, 2026, to mark the opening of its new advanced medical manufacturing and innovation facility in Indianapolis, which will serve the medical and life sciences industries and is expected to expand the company’s manufacturing capacity and local community presence. The company also revealed plans to rebrand as Kimball Solutions, Inc., beginning with a phased global rollout in July 2026 subject to necessary approvals, a move that reflects its broadened capabilities and solutions-driven strategy and is intended to reinforce its long-term commitment to innovation, comprehensive customer solutions, and growth in the EMS and CMO markets.

The most recent analyst rating on (KE) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on Kimball Electronics stock, see the KE Stock Forecast page.