Timken Company (TKR) AI Stock Analysis

• Market Cap: $7.46B
• Dividend Yield: 1.61%
• Average Volume (3M): 843.46K
• Price to Earnings (P/E): 26.1
• Beta (1Y): 1.05
• Revenue Growth: -1.01%
• EPS Growth: -12.13%
• Country: US
• Employees: 19,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 1.14
• Shares Outstanding: 69,544,300
• 10 Day Avg. Volume: 748,375
• 30 Day Avg. Volume: 843,464
• PEG Ratio: -1.15
• Price to Book (P/B): 1.84
• Price to Sales (P/S): 1.28
• P/FCF Ratio: 14.45
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 2.04
• Enterprise Value/Gross Profit: 7.10
• Enterprise Value/Ebitda: 12.50
• 1Y Price Target: $109.75
• Price Target Upside: 1.47% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 5.89
• Revenue Forecast (FY): $4.73B

• Rating: 72 Outperform
• Price Target: $117.00 ▲(8.17% Upside)

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

Strong free cash flow generation

Material FCF improvement in 2025 demonstrates durable cash conversion and operational cash strength. Sustained FCF supports reinvestment, debt paydown and shareholder returns, providing financial flexibility to fund growth and absorb cyclical downturns without relying on external financing.

Improving leverage and balance sheet

Progressive debt reduction and rising equity materially strengthen financial resilience. Lower leverage near target range enhances strategic optionality for M&A, capex or buybacks and reduces refinancing risk, improving long-term stability across industry cycles and interest-rate environments.

Industrial Motion and automation growth

Outperformance in Industrial Motion and accretive automation capabilities from acquisition diversify revenue mix toward higher-growth, technology-rich lines. This structural shift supports higher-margin aftermarket and automation demand, reducing reliance on cyclical engineered bearings over multiple years.

Negative Factors

Margin compression in engineered bearings

Sustained margin erosion in core engineered bearings from unfavorable mix and cost headwinds weakens earnings power. If structural mix shifts or cost inflation persist, profitability and cash generation could be structurally lower, pressuring funding for reinvestment and shareholder returns.

Tariff-related and policy uncertainty

Tariffs and trade policy introduce recurring cost and pricing volatility across global supply chains. Persistent or shifting tariff regimes can erode margins and complicate long-term pricing strategies, making forecasting and long-term contracting more difficult for capital-intensive industrial products.

Execution risk from 80/20 and OE pruning

Large-scale portfolio simplification and renegotiation carry multi-quarter costs and revenue contraction risk. Upfront investment and OEM exits can depress near-term top-line and require flawless execution to realize promised structural margin gains, exposing outcomes to timing and integration risk.

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 bearings, seals, and lubrication devices and systems, as well as power transmission components, engineered chains, augers, belts, couplings, clutches, brakes, and related products and maintenance services to original equipment manufacturers (OEMs) and end-users of off-highway equipment for the agricultural, construction, mining, outdoor power equipment, and power sports markets; and on-highway vehicles, including passenger cars, light trucks, and medium- and heavy-duty trucks, as well as rail cars and locomotives. It also provides power transmission systems and flight-critical components for civil and military aircraft, which include bearings, rotor-head assemblies, helicopter transmission systems, turbine engine components, gears, and housings. This segment sells its parts through a network of authorized automotive and heavy-truck distributors to individual end-users, equipment owners, operators, and maintenance shops. The Process Industries segment provides industrial bearings and assemblies; power transmission components, such as gears and gearboxes; and linear motion products, couplings, seals, lubricants, chains, belts, and related products and services to OEMs and end-users in various industries. It also offers aftermarket sales and service needs through a network of authorized industrial distributors; and repair and service for bearings and gearboxes, as well as electric motor rewind, repair, and services to end-users. The company offers its products under the Timken, Philadelphia Gear, Drives, Cone Drive, Rollon, Lovejoy, Diamond, BEKA, and Groeneveld brands. The Timken Company was founded in 1899 and is headquartered in North Canton, Ohio.

How the Company Makes Money

Timken generates revenue primarily through the sale of its bearings and mechanical power transmission products to a diverse customer base across various industries, including automotive, aerospace, and manufacturing. The company's revenue model is built on both direct sales and distribution partnerships, allowing it to reach a broad market. Key revenue streams include the sale of standard and custom-engineered bearings, as well as aftermarket services and solutions. Additionally, Timken benefits from long-term relationships with major clients and industries, which often leads to repeat business and ongoing contracts. The company also invests in research and development to innovate and enhance its product offerings, further solidifying its market position and driving future growth.

Timken Company Financial Statement Overview

Summary

Fundamentals are solid: revenue is steady, free cash flow improved materially in 2025 (~$406M) with consistently strong operating cash flow, and the balance sheet is strengthening as debt declines and equity rises. The main drag is margin/earnings compression in 2024–2025, which could limit upside if it persists.

Income Statement

Revenue has been relatively steady over 2022–2025 (roughly $4.5–$4.8B), with a dip in 2024 and a flat 2025. Profitability remains solid for the industry, with net margin generally in the 7–9% range (2024: ~7.7%; 2025: ~6.9%), but margins have compressed versus 2022–2023 as net income declined from ~$407M (2022) to ~$288M (2025). EBITDA also stepped down in 2025 versus prior years, indicating some pressure from costs and/or mix despite stable sales.

Balance Sheet

Leverage appears manageable and improving: debt moved down from ~$2.50B (2023) to ~$2.18B (2024) and ~$2.02B (2025), while equity increased to ~$3.35B in 2025. This supports a stronger capital base and better balance-sheet resilience. The main weakness is that profitability has been trending lower recently, which can reduce the pace of balance-sheet strengthening if it persists.

Cash Flow

Cash generation is a clear positive: operating cash flow has been consistently strong (roughly ~$464M–$577M historically; ~$554M in 2025) and free cash flow improved materially in 2025 to ~$406M from ~$306M in 2024. Free cash flow has generally tracked at a healthy portion of earnings (about ~0.6–0.8x net income across the period), supporting reinvestment, debt reduction, and shareholder returns. The key drawback is volatility in year-to-year free cash flow growth (down in 2021 and 2024, then sharply higher in 2025).

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

• Technical Analysis Sentiment: Positive
• Last Price: 108.16
• 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 TKR, the sentiment is Positive. The current price of 108.16 is above the 20-day moving average (MA) of 101.56, above the 50-day MA of 93.65, and above the 200-day MA of 79.81, indicating a bullish trend. The MACD of 4.57 indicates Negative momentum. The RSI at 71.53 is Negative, neither overbought nor oversold. The STOCH value of 57.23 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TKR.

Timken Company Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RBC	79 Outperform	$17.44B	64.85	8.66%	―	8.27%	19.06%
SNA	78 Outperform	$19.95B	20.03	17.96%	2.52%	0.24%	-1.85%
TKR	72 Outperform	$7.46B	26.11	9.60%	1.61%	-1.01%	-12.13%
LECO	72 Outperform	$15.90B	31.01	37.22%	1.22%	3.27%	10.89%
KMT	65 Neutral	$2.93B	26.92	8.70%	2.74%	-2.63%	-4.46%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SWK	62 Neutral	$13.91B	33.95	4.52%	4.42%	-1.40%	―

Timken Company Corporate Events

Timken Announces New Multi-Year Share Repurchase Program

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 transactions, or structured mechanisms such as accelerated share repurchases and Rule 10b5-1 plans. The program, which runs through February 28, 2031 and replaces a plan expiring February 28, 2026, signals the company’s ongoing capital-return strategy and may support earnings per share and shareholder value by reducing the share count over time.

The most recent analyst rating on (TKR) stock is a Buy with a $118.00 price target. To see the full list of analyst forecasts on Timken Company stock, see the TKR Stock Forecast page.

Timken Announces Planned Audit Committee Leadership Transition

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 role to director Sarah C. Lauber. The company emphasized that Palmer’s retirement is not related to any financial or accounting issues or disagreements, framing the move as an orderly governance transition rather than a response to underlying controversy, which should reassure investors and other stakeholders about the stability of Timken’s oversight processes.

The most recent analyst rating on (TKR) stock is a Hold with a $108.00 price target. To see the full list of analyst forecasts on Timken Company stock, see the TKR Stock Forecast page.