Education
About Us
Working with TipRanks
Follow Us
Knowles Corp (KN)
NYSE:KN
Top Page
Knowles
(NYSE:KN)
Select Model
Select Model
Rating:61Neutral
Price Target:
$22.50
▼(-0.18% Downside)
Knowles Corporation's overall stock score of 61 reflects a mix of positive earnings call sentiment and financial recovery, offset by bearish technical indicators and high valuation concerns. The company's strong revenue and EPS growth, along with strategic cash flow management, are significant positives. However, the stock's current technical weakness and high P/E ratio suggest caution.
Positive Factors
Strong Revenue Growth in Precision Devices
The Precision Devices segment's strong growth indicates robust demand across medtech, defense, and industrial markets, supporting long-term revenue expansion.
Effective Cash Flow Management
Strong cash flow management supports strategic investments, share buybacks, and debt reduction, enhancing financial stability and shareholder value.
Guidance for Continued Growth
Positive revenue guidance for Q4 2025 indicates continued business momentum and confidence in market demand, underpinning future growth prospects.
Negative Factors
Higher Production Costs in Specialty Film
Increased production costs in the specialty film line could pressure margins, requiring efficiency improvements to maintain profitability.
Increased SG&A Expenses
Rising SG&A expenses may impact net margins, necessitating cost control measures to sustain profitability and operational efficiency.
Tariff Exposure
While currently manageable, tariff exposure poses a risk to cost structures and pricing strategies, potentially affecting competitive positioning.
Knowles (KN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.92B
Dividend YieldN/A
Average Volume (3M)738.23K
Price to Earnings (P/E)50.5
Beta (1Y)1.59
Revenue Growth-24.42%
EPS GrowthN/A
CountryUS
Employees5,500
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)0.33
Shares Outstanding85,151,886
10 Day Avg. Volume935,943
30 Day Avg. Volume738,231
Financial Highlights & Ratios
PEG Ratio0.02
Price to Book (P/B)2.34
Price to Sales (P/S)3.20
P/FCF Ratio15.21
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue3.73
Enterprise Value/Gross Profit9.15
Enterprise Value/Ebitda22.38
Forecast
1Y Price Target
$27.00Price Target Upside19.79% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Knowles Business Overview & Revenue Model
Company DescriptionKnowles Corporation offers micro-acoustic microphones and balanced armature speakers, audio solutions, high performance capacitors, and radio frequency products for the consumer electronics, medtech, defense, electric vehicle, industrial, and communications markets. It operates in two segments, Audio and Precision Devices (PD). The Audio segment designs and manufactures audio products, including microphones, balanced armature speakers, and audio processors used in applications that serve the mobile, hearing health, True Wireless Stereo, Internet of Things, and computing markets. The PD segment is involved in the design and delivery of high-performance capacitor products and RF solutions that are used in applications, such as power supplies and medical implants, satellite communications, and radar systems, as well as for communications equipment. The company sells its products directly to original equipment manufacturers and to their contract manufacturers and suppliers, as well as through distributors. It has operations in Asia, the United States, Europe, other Americas, and internationally. The company was founded in 1946 and is headquartered in Itasca, Illinois.
How the Company Makes MoneyKnowles generates revenue primarily through the sale of its audio products, including MEMS microphones and balanced armature speakers. The company sells these products to major electronics manufacturers and OEMs (original equipment manufacturers) across various sectors, including mobile devices, automotive, and healthcare. Key revenue streams include direct sales to large technology companies as well as partnerships with industry leaders that leverage Knowles' audio technology in their devices. Additionally, Knowles benefits from ongoing demand for high-quality audio solutions, as trends like voice activation and smart device integration continue to grow, further driving sales and fostering long-term relationships with clients.
Knowles Earnings Call Summary
Earnings Call Date:Oct 23, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 05, 2026
Earnings Call Sentiment Positive
The earnings call reflected a generally positive sentiment with strong revenue and EPS growth, particularly in the Precision Devices segment and defense market. The company is demonstrating effective cash flow management and strategic investments leading to share buybacks and debt reduction. However, challenges remain with higher production costs in the specialty film line, increased SG&A expenses, and tariff exposure. Overall, the highlights outweigh the lowlights, suggesting optimistic future growth.Q3-2025 Updates
Positive Updates
Overall Revenue and EPS Growth
Revenue for Q3 2025 was $153 million, up 7% year-over-year. EPS increased by 22% year-over-year to $0.33.
Precision Devices Segment Success
Q3 revenue for the Precision Devices segment was $88 million, up 12% year-over-year with strong growth across medtech, defense, industrial, and EV and energy markets.
Strong Cash Flow and Share Buyback
Cash from operations was $29 million, enabling a share buyback of $20 million and a reduction in bank borrowings by $15 million.
Defense Market Performance
The defense market showed particularly strong design wins and bookings, supported by increased defense spending and robust demand for military applications.
Guidance for Continued Growth
Revenue for Q4 2025 is expected to be between $151 million and $161 million, up 9% at the midpoint year-over-year, with EPS projected between $0.33 and $0.37.
Negative Updates
Higher Production Costs in Specialty Film
The ramp-up of the specialty film product line resulted in higher production costs and lower-than-expected yields, impacting gross margins.
Increased SG&A Expenses
SG&A expenses rose by $2 million from the prior year, driven by annual merit increases and higher incentive compensation costs.
Tariff Exposure
While tariff exposure is less than 5% of revenue and 3% of cost of goods sold, it remains a concern, though successfully passed on to customers so far.
Company Guidance
During the Q3 2025 earnings call, Knowles Corporation reported strong financial performance, with revenue reaching $153 million, a 7% increase year-over-year. Earnings per share (EPS) were $0.33, marking a 22% rise from the previous year, and cash from operations was $29 million, all surpassing the midpoint of their guidance range. The Medtech & Specialty Audio segment achieved $65 million in revenue, a 2% increase, while the Precision Devices segment reported $88 million in revenue, up 12%. The company anticipates continued growth, with Medtech & Specialty Audio projected to grow 2% to 4%, and Precision Devices expected to grow at the high end of their 6% to 8% range in 2025. Cash generation from operations is projected to be 16% to 20% of revenues for the year, supporting share repurchases and debt reduction. For Q4 2025, Knowles expects revenues between $151 million and $161 million, with EPS forecasted to range from $0.33 to $0.37.Knowles Financial Statement Overview
Summary
Knowles has demonstrated a recovery in profitability and maintains a strong balance sheet with low leverage. While revenue growth and profit margins are improving, cash flow metrics indicate potential challenges in sustaining growth. Overall, the company is on a positive trajectory but needs to focus on enhancing operational efficiency and cash flow generation.Income Statement
Knowles has shown a modest revenue growth rate of 1.85% TTM, with a strong gross profit margin of 42.01%. The net profit margin improved significantly to 7.55% TTM from a negative margin in the previous year, indicating a turnaround in profitability. However, the EBIT margin of 5.31% and EBITDA margin of 51.60% TTM suggest room for improvement in operational efficiency.Balance Sheet
The company's debt-to-equity ratio of 0.26 TTM indicates a conservative leverage position, which is positive for financial stability. The return on equity (ROE) of 5.75% TTM shows a recovery from previous losses, although it remains below industry averages. The equity ratio of 69.09% TTM reflects a strong capital structure with a high proportion of equity financing.Cash Flow
Operating cash flow to net income ratio of 0.58 TTM suggests moderate cash generation relative to earnings. The free cash flow to net income ratio of 0.80 TTM is healthy, but the free cash flow growth rate has declined by 25.30% TTM, indicating potential challenges in sustaining cash flow growth.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 573.50M | 553.50M | 456.80M | 764.70M | 868.10M | 764.30M |
| Gross Profit | 233.80M | 221.20M | 200.10M | 300.80M | 341.50M | 259.30M |
| EBITDA | 95.60M | 92.40M | 70.90M | -360.00M | 181.50M | 89.00M |
| Net Income | 39.30M | -239.50M | 72.40M | -430.10M | 150.40M | 6.60M |
Balance Sheet | ||||||
| Total Assets | 1.09B | 1.12B | 1.46B | 1.18B | 1.73B | 1.65B |
| Cash, Cash Equivalents and Short-Term Investments | 92.50M | 130.10M | 87.30M | 48.20M | 68.90M | 147.80M |
| Total Debt | 197.00M | 213.00M | 286.70M | 64.50M | 102.40M | 202.10M |
| Total Liabilities | 336.40M | 362.20M | 428.70M | 191.00M | 275.10M | 351.40M |
| Stockholders Equity | 751.80M | 756.00M | 1.03B | 992.90M | 1.46B | 1.30B |
Cash Flow | ||||||
| Free Cash Flow | 81.80M | 116.50M | 105.50M | 54.20M | 133.50M | 96.20M |
| Operating Cash Flow | 101.90M | 130.10M | 122.70M | 86.30M | 182.10M | 128.10M |
| Investing Cash Flow | 32.00M | 45.20M | -141.60M | -32.70M | -129.60M | -35.10M |
| Financing Cash Flow | -133.40M | -132.00M | 58.20M | -73.20M | -131.40M | -23.90M |
Knowles Technical Analysis
Positive
22.54
Price Trends
22.48
Positive
22.51
Positive
19.81
Positive
Market Momentum
-0.03
Negative
51.75
Neutral
66.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KN, the sentiment is Positive. The current price of 22.54 is above the 20-day moving average (MA) of 22.36, above the 50-day MA of 22.48, and above the 200-day MA of 19.81, indicating a bullish trend. The MACD of -0.03 indicates Negative momentum. The RSI at 51.75 is Neutral, neither overbought nor oversold. The STOCH value of 66.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KN.
Knowles Risk Analysis
Knowles disclosed 23 risk factors in its most recent earnings report. Knowles reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Knowles Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.08B | 22.66 | 11.38% | ― | 1.93% | -43.22% | |
71 Outperform | $3.82B | 260.43 | 2.13% | ― | 15.60% | ― | |
68 Neutral | $1.59B | 39.09 | 6.71% | ― | 1.46% | 78.77% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $1.92B | 50.54 | 4.68% | ― | -24.42% | ― | |
50 Neutral | $707.42M | -8.13 | -48.44% | ― | 14.33% | 83.32% | |
49 Neutral | $663.20M | -25.68 | -4.94% | ― | 2.95% | -228.28% |
* Technology Sector Average
KN
Knowles
22.54
3.21
16.61%
ADTN
Adtran
8.83
-1.18
-11.79%
DGII
Digi International
42.37
13.95
49.09%
HLIT
Harmonic
9.60
-2.84
-22.83%
NTGR
Netgear
23.35
-2.59
-9.98%
VIAV
Viavi Solutions
17.11
7.19
72.48%
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.