Knowles (KN) AI Stock Analysis

• Market Cap: $1.91B
• Dividend Yield: N/A
• Average Volume (3M): 537.87K
• Price to Earnings (P/E): 82.0
• Beta (1Y): 1.70
• Revenue Growth: -28.85%
• EPS Growth: N/A
• Country: US
• Employees: 5,500
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): 0.24
• Shares Outstanding: 85,887,600
• 10 Day Avg. Volume: 601,561
• 30 Day Avg. Volume: 537,873
• PEG Ratio: 0.02
• Price to Book (P/B): 2.34
• Price to Sales (P/S): 3.20
• P/FCF Ratio: 15.21
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 2.93
• Enterprise Value/Gross Profit: 6.95
• Enterprise Value/Ebitda: 5.74
• 1Y Price Target: $21.67
• Price Target Upside: -4.87% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 70 Outperform
• Price Target: $25.00 ▲(9.75% Upside)

Knowles Corporation demonstrates strong operational efficiency and positive earnings call outcomes, which are significant strengths. However, the high P/E ratio and overbought technical indicators suggest caution. The company's stable financial position and positive earnings guidance are promising, but the lack of revenue growth and high valuation are key risks.

Positive Factors

Revenue Growth

The consistent revenue growth indicates strong market demand and effective sales strategies, particularly in the MedTech & Specialty Audio and Precision Devices segments.

Cash Flow Performance

Strong cash flow performance enhances financial flexibility, allowing the company to invest in growth opportunities and maintain shareholder returns through activities like share repurchases.

Segment Growth

Growth in key segments like MedTech & Specialty Audio underscores the company's ability to capitalize on industry trends and expand its market presence.

Negative Factors

Gross Margin Pressure

Declining gross margins can impact profitability, suggesting challenges in cost management and pricing power, which may affect long-term financial performance.

R&D and SG&A Expense Increases

Increasing R&D and SG&A expenses could pressure margins if not matched by revenue growth, potentially impacting future profitability and operational efficiency.

Negative Revenue Growth

Negative revenue growth indicates potential market or operational challenges, which could hinder the company's ability to sustain long-term growth and competitiveness.

Knowles Business Overview & Revenue Model

Company Description

Knowles Corporation (KN) is a leading provider of advanced micro-acoustic microphones, balanced armature speakers, and other audio solutions. The company operates primarily in the consumer electronics, mobile communications, and industrial markets, offering innovative products that enhance audio performance in various devices. Knowles is recognized for its cutting-edge technology in sound capture and reproduction, catering to manufacturers of smartphones, wearables, and other electronic devices.

How the Company Makes Money

Knowles generates revenue through the sale of its audio components, particularly its MEMS microphones and speakers, which are integral to smartphones, tablets, and other consumer electronics. The company maintains key partnerships with major technology companies, allowing it to secure long-term contracts and a stable customer base. Additionally, Knowles benefits from a diversified product portfolio that includes both high-end and cost-effective audio solutions, enabling it to capture a wide market segment. The company's revenue model is primarily based on direct sales to OEMs (original equipment manufacturers) and ODMs (original design manufacturers), along with licensing agreements for its proprietary technologies.

Knowles Financial Statement Overview

Summary

Knowles presents a stable financial profile with strong operational efficiency and a solid balance sheet. Despite challenges in revenue growth, the company maintains healthy profit margins and cash flow metrics, suggesting resilience. The conservative leverage and strong equity position provide a buffer against market fluctuations.

Income Statement

Knowles has shown a mixed performance in its income statement. The TTM data reveals a gross profit margin of 42.21%, which is healthy and indicates efficient cost management. However, the net profit margin is relatively low at 4.69%, reflecting challenges in converting revenue into profit. The revenue growth rate has been negative, with a decline of 9.46% in the TTM period, indicating potential market or operational challenges. Despite this, the EBIT and EBITDA margins are strong at 52.58% and 51.07%, respectively, suggesting robust operational efficiency.

Balance Sheet

The balance sheet of Knowles shows a stable financial position with a debt-to-equity ratio of 0.28, indicating a conservative approach to leveraging. The return on equity is modest at 3.48%, suggesting moderate profitability from shareholders' investments. The equity ratio stands at 68.56%, reflecting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Cash flow analysis indicates a positive trajectory with a free cash flow growth rate of 9.61% in the TTM period. The operating cash flow to net income ratio is 0.75, demonstrating a solid ability to generate cash from operations relative to net income. The free cash flow to net income ratio is high at 0.87, indicating efficient cash conversion from profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	563.10M	553.50M	707.60M	764.70M	868.10M	764.30M
Gross Profit	237.70M	234.80M	283.40M	276.30M	359.50M	271.20M
EBITDA	287.60M	51.80M	98.90M	-360.00M	184.90M	110.50M
Net Income	26.40M	-239.50M	72.40M	-430.10M	150.40M	2.90M
Balance Sheet
Total Assets	1.09B	1.12B	1.46B	1.18B	1.73B	1.65B
Cash, Cash Equivalents and Short-Term Investments	103.20M	130.10M	87.30M	48.20M	68.90M	147.80M
Total Debt	210.90M	213.00M	286.70M	60.60M	96.10M	194.00M
Total Liabilities	342.20M	362.20M	428.70M	191.00M	272.10M	351.40M
Stockholders Equity	746.10M	756.00M	1.03B	992.90M	1.46B	1.30B
Cash Flow
Free Cash Flow	109.50M	116.50M	105.50M	54.20M	133.50M	96.20M
Operating Cash Flow	125.60M	130.10M	122.70M	86.30M	182.10M	128.10M
Investing Cash Flow	36.00M	45.20M	-141.60M	-32.70M	-129.60M	-35.10M
Financing Cash Flow	-142.50M	-132.00M	58.20M	-73.20M	-131.40M	-23.90M

Knowles Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 22.78
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: 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 22.78 is above the 20-day moving average (MA) of 21.62, above the 50-day MA of 20.35, and above the 200-day MA of 18.18, indicating a bullish trend. The MACD of 0.58 indicates Negative momentum. The RSI at 71.50 is Negative, neither overbought nor oversold. The STOCH value of 77.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KN.

Knowles Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGII	78 Outperform	1.35B	33.42	6.87%	―	-2.37%	147.46%
HLIT	78 Outperform	1.14B	17.93	15.38%	―	24.14%	16.17%
KN	70 Outperform	$1.91B	81.97	3.60%	―	-28.85%	―
NTGR	70 Outperform	830.51M	13.61	12.18%	―	0.76%	0.00%
VIAV	65 Neutral	2.72B	80.34	4.46%	―	8.39%	0.00%
ADTN	56 Neutral	702.06M	-7.25	-64.24%	―	3.52%	81.33%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Knowles Corporate Events

Knowles Announces Investor Update Meeting on May 13

Knowles Corporation announced an investor update meeting scheduled for May 13, 2025, to discuss its business and financial outlook. The company is repositioning its portfolio towards higher-margin products and markets, including MedTech, Defense, and Industrial sectors, and aims for significant revenue and EBITDA growth over the next five years. The strategic shift involves divestitures and acquisitions, enhancing its market position and financial performance, which is expected to create value for stakeholders.

The most recent analyst rating on (KN) stock is a Buy with a $25.00 price target. To see the full list of analyst forecasts on Knowles stock, see the KN Stock Forecast page.