Timken (TKR)
NYSE:TKR
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Timken Company
(NYSE:TKR)
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Rating:72Outperform
Price Target:
$106.00
▲(7.14% Upside)
Action:ReiteratedDate:02/19/26
The score reflects healthy financial quality (strong and improving free cash flow plus a strengthening balance sheet) and favorable technical momentum. These positives are partially offset by a relatively expensive valuation and ongoing risks from margin pressure and tariff/mix headwinds, despite constructive 2026 guidance.
Positive Factors
Free Cash Flow / Cash Generation
Sustained improvement to ~$406M FCF in 2025 signals durable cash conversion from operations, enabling reinvestment, debt paydown, and shareholder returns. Strong cash generation supports multi-year capital allocation flexibility even through cyclical industrial demand swings.
Negative Factors
Engineered Bearings Margin Pressure
Engineered bearings are core to Timken’s revenue, and persistent mix and margin erosion reduces overall profitability and cash flow. If unfavorable mix, raw-material or tariff pressures continue, margins and funding for strategic initiatives could be constrained for multiple quarters or longer.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow / Cash Generation
Sustained improvement to ~$406M FCF in 2025 signals durable cash conversion from operations, enabling reinvestment, debt paydown, and shareholder returns. Strong cash generation supports multi-year capital allocation flexibility even through cyclical industrial demand swings.
Read all positive factors
Timken Company (TKR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.88B
Dividend Yield1.61%
Average Volume (3M)761.29K
Price to Earnings (P/E)20.4
Beta (1Y)1.05
Revenue Growth-1.01%
EPS Growth-12.13%
CountryUS
Employees19,000
SectorIndustrials
Sector Strength72
IndustryManufacturing - Tools & Accessories
Share Statistics
EPS (TTM)1.14
Shares Outstanding69,544,300
10 Day Avg. Volume708,838
30 Day Avg. Volume761,291
Financial Highlights & Ratios
PEG Ratio-1.15
Price to Book (P/B)1.84
Price to Sales (P/S)1.28
P/FCF Ratio14.45
Enterprise Value/Market Cap1.26
Enterprise Value/Revenue1.90
Enterprise Value/Gross Profit6.61
Enterprise Value/Ebitda11.64
Forecast
1Y Price Target
$112.13Price Target Upside13.33% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
EPS Forecast (FY)5.88
Revenue Forecast (FY)$4.74B
Timken Company Business Overview & Revenue Model
Company Description
The Timken Company designs, manufactures, and manages engineered bearings and power transmission products worldwide. It operates in two segments, Mobile Industries and Process Industries. The Mobile Industries segment offers a portfolio of bearing...
How the Company Makes Money
Timken makes money primarily by selling engineered components and systems to industrial and mobility original equipment manufacturers (OEMs) and to aftermarket customers that replace parts during maintenance and repair. Its core revenue stream is ...
Timken Company Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call conveyed positive momentum: the company beat Q4 EPS guidance, delivered revenue growth, materially improved free cash flow (+$100M YoY) and reduced net debt with leverage at ~2x. Industrial Motion and automation-related businesses are growing strongly, backlog and order trends are encouraging, and management provided a constructive 2026 outlook (organic +2% midpoint and EPS growth). However, meaningful near-term headwinds persist: engineered bearings showed organic decline and margin compression due to mix and tariff impacts, China and some end markets remain weak, and the expanded 80/20 initiative will require upfront costs with benefits realized over multiple quarters. On balance, highlights (strong cash generation, debt reduction, Industrial Motion strength, and a positive 2026 guide) outweigh the lowlights, though execution and tariff/macro uncertainties remain key risks.Positive Updates
Q4 Adjusted EPS Beat
Adjusted EPS of $1.14 in Q4, which exceeded the high end of the company's guidance range.
Negative Updates
Engineered Bearings Organic Decline and Margin Pressure
Engineered Bearings sales were $714 million in Q4, up 0.9% total but organic sales down ~1%; adjusted EBITDA fell to $115 million (16.1% of sales) from $122 million (17.2%) a year ago, driven by unfavorable mix and incremental tariff costs.
Read all updates
Q4-2025 Updates
Positive
Negative
Q4 Adjusted EPS Beat
Adjusted EPS of $1.14 in Q4, which exceeded the high end of the company's guidance range.
Read all positive updates
Company Guidance
Timken’s 2026 guidance calls for total revenue growth of 2–4% (currency ~+1% for the year; organic revenue ~+2% at the midpoint), adjusted EPS of $5.50–$6.00 (midpoint $5.75, ~+8% vs. 2025) with a roughly 54%/46% H1/H2 split, consolidated adjusted EBITDA margin in the high‑17% range at the midpoint (implying ~30% incremental margin on growth), free cash flow of about $350 million (~105% conversion of GAAP net income at the midpoint), a Q1 currency headwind of ~+3% to the top line with organic sales and EBITDA margins expected to be flat vs. last year, tariff mitigation worth roughly $0.10–$0.15 per share, and the outlook is supported by net leverage near 2x and a backlog up high‑single‑digits.Timken Company Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
72
Positive
Cash Flow
75
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.58B | 4.57B | 4.77B | 4.50B | 4.13B |
| Gross Profit | 1.31B | 1.45B | 1.52B | 1.34B | 1.16B |
| EBITDA | 746.10M | 834.30M | 915.10M | 838.20M | 713.80M |
| Net Income | 288.40M | 352.70M | 394.10M | 407.40M | 369.10M |
Balance Sheet | |||||
| Total Assets | 6.68B | 6.41B | 6.54B | 5.77B | 5.17B |
| Cash, Cash Equivalents and Short-Term Investments | 386.50M | 389.50M | 450.90M | 379.90M | 314.80M |
| Total Debt | 2.16B | 2.26B | 2.58B | 2.12B | 1.65B |
| Total Liabilities | 3.33B | 3.43B | 3.84B | 3.42B | 2.79B |
| Stockholders Equity | 3.18B | 2.83B | 2.58B | 2.27B | 2.29B |
Cash Flow | |||||
| Free Cash Flow | 406.10M | 305.70M | 357.40M | 285.40M | 239.00M |
| Operating Cash Flow | 554.30M | 475.70M | 545.20M | 463.80M | 387.30M |
| Investing Cash Flow | -148.30M | -304.60M | -806.50M | -573.30M | -173.80M |
| Financing Cash Flow | -437.10M | -194.80M | 347.10M | 206.80M | -269.30M |
Timken Company Technical Analysis
Negative
98.94
Price Trends
101.58
Negative
92.94
Positive
84.36
Positive
Market Momentum
-0.69
Negative
47.46
Neutral
59.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TKR, the sentiment is Negative. The current price of 98.94 is below the 20-day moving average (MA) of 99.33, below the 50-day MA of 101.58, and above the 200-day MA of 84.36, indicating a neutral trend. The MACD of -0.69 indicates Negative momentum. The RSI at 47.46 is Neutral, neither overbought nor oversold. The STOCH value of 59.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TKR.
Timken Company Risk Analysis
Timken Company disclosed 31 risk factors in its most recent earnings report. Timken Company reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Timken Company Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $17.47B | 53.36 | 8.53% | ― | 8.27% | 19.06% | |
78 Outperform | $19.01B | 17.98 | 17.70% | 2.52% | 0.24% | -1.85% | |
72 Outperform | $6.88B | 20.35 | 9.35% | 1.61% | -1.01% | -12.13% | |
72 Outperform | $13.05B | 25.51 | 37.15% | 1.22% | 3.27% | 10.89% | |
65 Neutral | $2.76B | 16.15 | 8.61% | 2.74% | -2.63% | -4.46% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
55 Neutral | $10.54B | 28.82 | 4.47% | 4.42% | -1.40% | ― |
* Industrials Sector Average
TKR
Timken Company
98.94
42.57
75.52%
KMT
Kennametal
36.26
19.27
113.37%
LECO
Lincoln Electric Holdings
238.05
73.08
44.30%
RBC
RBC Bearings
552.40
247.61
81.24%
SNA
Snap-on
366.27
65.08
21.61%
SWK
Stanley Black & Decker
67.98
14.68
27.54%
Timken Company Corporate Events
Business Operations and StrategyStock Buyback
Timken Announces New Multi-Year Share Repurchase Program
Positive
Feb 17, 2026
On February 13, 2026, Timken’s board approved a new share purchase plan effective March 1, 2026, authorizing the company to buy back up to 10 million of its outstanding common shares through open market purchases, privately negotiated transa...
Executive/Board Changes
Timken Announces Planned Audit Committee Leadership Transition
Positive
Feb 13, 2026
On February 13, 2026, Timken announced that James F. Palmer, chair of the Audit Committee and a member of the Compensation Committee, will retire from the board effective March 31, 2026, as part of a planned transition of the Audit Committee chair...
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.