Timken Company (TKR) AI Stock Analysis

• Market Cap: $5.28B
• Dividend Yield: 1.93%
• Average Volume (3M): 542.42K
• Price to Earnings (P/E): 16.3
• Beta (1Y): 1.09
• Revenue Growth: -3.69%
• EPS Growth: -11.76%
• Country: US
• Employees: 19,000
• Sector: Industrials
• Sector Strength: 88
• Industry: Manufacturing - Tools & Accessories
• EPS (TTM): 1.40
• Shares Outstanding: 69,963,040
• 10 Day Avg. Volume: 678,546
• 30 Day Avg. Volume: 542,422
• PEG Ratio: 0.91
• Price to Book (P/B): 2.29
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.23
• Enterprise Value/Market Cap: 1.31
• Enterprise Value/Revenue: 0.38
• Enterprise Value/Gross Profit: 4.98
• Enterprise Value/Ebitda: 2.14
• 1Y Price Target: $76.75
• Price Target Upside: 1.74% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 74 Outperform
• Price Target: $80.00 ▲(6.04%Upside)

Timken's overall stock score is supported primarily by its stable financial performance and strong cash flow management. While technical analysis shows some positive momentum, valuation metrics indicate a fair price. The earnings call highlighted both strengths in cost management and challenges in revenue growth and tariff impacts. The balanced assessment results in a moderately positive outlook.

Positive Factors

Growth Areas

The company is positioned in secular growth areas like automation and robotics, providing incremental upside to earnings.

Portfolio Transformation

The company's strategic portfolio changes have improved earnings stability and margin structure.

Negative Factors

CEO Transition

The abrupt change in CEO and return of Rich Kyle is a temporary solution, likely limiting potential for meaningful strategic news.

Tariff Risks

Tariffs pose a risk to margin performance for Timken due to their contract-based exposure to OEMs.

Timken Company Business Overview & Revenue Model

Company Description

The Timken Company (TKR) is a global industrial leader specializing in engineered bearings and power transmission products. With a rich history dating back to 1899, Timken operates in sectors such as automotive, aerospace, construction, mining, agriculture, and power generation. The company's core products include a wide range of bearings, gear drives, belts, chains, couplings, and lubrication systems, which are essential components in reducing friction and improving efficiency in machinery and equipment.

How the Company Makes Money

Timken generates revenue primarily through the manufacture and sale of its engineered bearings and power transmission products. The company's revenue streams are diversified across several key industries including automotive, aerospace, and industrial sectors, where demand for reliable and high-performance components is high. Timken also engages in aftermarket sales, providing replacement parts and maintenance services, which contribute to a recurring revenue stream. Significant partnerships and acquisitions have also bolstered Timken's market position and expanded its product offerings, enhancing its ability to meet the needs of a global customer base. Timken's financial performance is influenced by factors such as industrial production levels, economic conditions, and technological advancements in manufacturing processes, all of which can impact demand for its products and services.

Timken Company Financial Statement Overview

Summary

The company's financial performance is solid, with strong cash flow metrics and moderate profitability margins. Despite a slight decline in revenue, the company maintains balanced leverage and efficient cash flow management, indicating stable financial health.

Income Statement

The company's income statement shows strong profitability with a gross profit margin of 47.89% and an EBIT margin of 12.72% in TTM. However, there is a slight decline in revenue compared to the previous year, leading to a revenue growth rate of -1.09%. The net profit margin stands at 7.53%, indicating stable profitability but with room for improvement.

Balance Sheet

The balance sheet reflects a moderate financial position with a debt-to-equity ratio of 0.72, indicating a balanced leverage. The equity ratio is 47.03%, showing a fair proportion of equity in the total asset structure. Return on equity (ROE) is 11.03%, highlighting reasonable returns on shareholders' investments.

Cash Flow

Cash flow metrics are robust, with a free cash flow to net income ratio of 0.95, indicating efficient conversion of earnings into cash. The operating cash flow to net income ratio is 1.42, underscoring solid cash generation capacity. Free cash flow growth is positive at 5.95%, signaling strong cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.52B	4.57B	4.77B	4.50B	4.13B	3.51B
Gross Profit	1.38B	1.44B	1.44B	1.29B	1.10B	1.01B
EBITDA	744.00M	841.10M	842.50M	822.60M	703.20M	631.00M
Net Income	327.50M	352.70M	394.10M	407.40M	369.10M	284.50M
Balance Sheet
Total Assets	6.57B	6.41B	6.54B	5.77B	5.17B	5.04B
Cash, Cash Equivalents and Short-Term Investments	376.10M	373.20M	418.90M	331.60M	257.10M	320.30M
Total Debt	2.25B	2.18B	2.50B	2.03B	1.54B	1.67B
Total Liabilities	3.48B	3.43B	3.84B	3.42B	2.79B	2.82B
Stockholders Equity	2.92B	2.83B	2.58B	2.27B	2.29B	2.15B
Cash Flow
Free Cash Flow	323.90M	305.70M	357.40M	285.40M	239.00M	456.00M
Operating Cash Flow	485.00M	475.70M	545.20M	463.80M	387.30M	577.60M
Investing Cash Flow	-312.60M	-304.60M	-806.50M	-573.30M	-173.80M	-153.50M
Financing Cash Flow	-210.40M	-194.80M	347.10M	206.80M	-269.30M	-331.10M

Timken Company Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 75.44
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• 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 75.44 is above the 20-day moving average (MA) of 72.04, above the 50-day MA of 69.54, and above the 200-day MA of 74.56, indicating a bullish trend. The MACD of 1.07 indicates Negative momentum. The RSI at 64.26 is Neutral, neither overbought nor oversold. The STOCH value of 67.72 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
GTES	77 Outperform	$6.03B	28.31	6.93%	―	-4.01%	-8.86%
CSW	74 Outperform	$4.87B	34.60	16.19%	0.33%	10.41%	34.56%
TKR	74 Outperform	$5.28B	16.28	11.85%	1.93%	-3.69%	-11.76%
KTOS	73 Outperform	$7.03B	367.78	1.45%	―	7.32%	―
MOG.A	73 Outperform	$5.76B	28.30	11.61%	0.64%	4.50%	9.90%
HXL	68 Neutral	$4.60B	37.71	7.87%	1.20%	5.37%	29.15%
Sector *	65 Neutral	$10.65B	15.49	5.57%	1.97%	2.71%	-26.32%

Timken Company Corporate Events

Timken Company Appoints Richard G. Kyle as Interim CEO

On March 31, 2025, The Timken Company announced the mutual agreement for Tarak B. Mehta to depart as President and CEO, with Richard G. Kyle appointed as interim President and CEO. Kyle, who previously served as CEO from 2014 to 2024, will receive a compensation package including a $1.2 million salary and stock awards. Mehta’s departure was not due to misconduct, and he will receive a $9.25 million settlement.