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what it is
Knowles makes tiny electronic parts that end up in defense gear, medical devices, hearing products, and premium audio hardware.
how it gets paid
Last year Knowles made $593M in revenue.
what just happened
Knowles posted $0.36 EPS in Q4 2025, edging the $0.35 consensus while revenue jumped to $411 million.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
55/100 earnings predictability — expect surprises
24.8x trailing p/e — priced about right
14.5% return on capital — nothing to write home about
xvary composite: 59/100 — below average
What they do
Knowles makes tiny electronic parts that end up in defense gear, medical devices, hearing products, and premium audio hardware.
Knowles sells the kind of parts your device cannot fake with software. Precision Devices is 55% of 2025 sales, and MedTech & Specialty Audio is the other 45%, giving you exposure to defense and medical markets where qualification cycles are slow and switching suppliers is painful. International sales are 58% of revenue, which tells you this is a real component supplier, not a niche lab project.
How they make money
$593M
annual revenue
total revenue
$593M
n/a
The products that matter
designs and manufactures components
Specialty electronic components
$593M revenue base
It is effectively the whole business today at $593M in annual revenue, and the investment case depends on turning that base into the $775M revenue estimate for fy2029.
44.7% gross margin
earnings growth expectation
FY2027 EPS outlook
$1.45 estimate
At $27.48, that estimate implies about a 19x forward earnings multiple. In human-speak: the market expects improvement, not a stall.
valuation hinge
long-range revenue target
FY2029 revenue path
$775M estimate
That is about $182M above the current $593M base. Same business. Bigger expectations. That gap is the entire debate.
growth test
Key numbers
24.8x
trailing p/e
That is the price you pay for each dollar of trailing profit, and it leaves less room for a stumble.
27.0%
operating margin
Operating margin → profit left after running the business → so what: Knowles turns more than a quarter of sales into operating profit.
14.5%
return on capital
Return on capital → profit earned on money invested in the business → so what: the company is not just growing, it is earning decent returns on that growth.
58%
international mix
More than half of sales come from outside the U.S., which broadens demand but adds currency and policy risk.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 55 / 100
- long-term debt $114M (5% of capital)
- net profit margin 18.7% — keeps 19 cents of every dollar in revenue
- return on equity 16% — $0.16 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in KN 3 years ago → it's now worth $16,170.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
Knowles posted $0.36 EPS in Q4 2025, edging the $0.35 consensus while revenue jumped to $411 million.
The quarter looked strong on the surface. Revenue rose 188% vs. prior year and gross margin was 44.7%, but the portfolio changed a lot after the Consumer MMS sale and the Cornell Dubilier acquisition.
$148M
revenue
$0.36
eps
44.7%
gross margin
the number that mattered
44.7% gross margin matters most because it tells you the added revenue is still carrying healthy economics, not just bulked-up low-quality sales.
-
knowles stock has been enjoying strong investor support of late.
-
the shares have climbed 26% in price since our last report in december and are trading above $25 for the first time in more than a decade.recent results appear to be boosting the market’s confidence that the company’s revamped product portfolio can deliver more-consistent sales and earnings growth.
-
in the absence of the consumer mms microphone business, which was sold in 2024, revenues rose 7% last year, while earnings advanced 22%, to $1.11 a share.
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most recently, december-quarter results made for good reading, with a 14% increase on the top line helping to lift profits 33%, to $0.36 a share.
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the precision device segment has been helping to lead the way.this business had a sluggish start to 2025, but perked up in the second half after excess inventories in the distribution channel were cleared.
source: company earnings report, 2026
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What could go wrong
The clean risk here is execution, not balance-sheet stress. Knowles has only $114M of long-term debt, but the stock already reflects a better future than the current $593M revenue base and 55/100 predictability score fully prove.
high
growth estimate slippage
The revenue path goes from $593M today to a $775M fy2029 estimate. If that bridge starts shrinking, the market has less reason to pay 24.8x trailing earnings.
$182M of expected future annual revenue is the gap investors are underwriting
high
margin compression in a premium-margin business
A 44.7% gross margin and 27.0% operating margin are what make this company interesting. If either starts sliding, the niche-quality narrative weakens fast.
the business works because profitability is strong for its size
med
earnings volatility
The predictability score is 55/100. In human-speak: KN has enough variance in the numbers that one bad print can change the story faster than investors like.
less room for misses when the stock is near its 52-week high
med
noisy public-source legal headlines
The source feed includes odd legal and compliance references rather than a clean operating narrative. That does not prove a major problem, but it does mean the risk data is headline-noisy and worth monitoring.
governance noise can distract from a still-developing operating story
The cleanest quantified takeaway: KN trades at 24.8x trailing earnings with a 55/100 predictability score, while the long-term revenue case still depends on growing from $593M to $775M.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
gross margin staying near 44.7%
This is the easiest shortcut to the whole thesis. If the margin holds, the niche-components story is intact. If it fades, the premium multiple gets lonely.
calendar
estimate revisions to fy2027 EPS and fy2029 revenue
$1.45 of fy2027 EPS and $775M of fy2029 revenue are doing a lot of work in the valuation. Watch the estimates before you watch the headlines.
trend
whether the stock can hold near the top of its $12–$28 range
A stock living near its high is being given the benefit of the doubt. That usually lasts right until the first real miss.
risk
any cleaner read on the legal and compliance headline feed
The current source trail is messy. That may be nothing. It may also be the kind of loose end that matters more later than it does now.
Analyst rankings
earnings predictability
55 / 100
in human-speak, analysts do not see KN as a smooth quarter-after-quarter machine.
risk rank
3
Safer than about 50% of stocks. Not reckless. Not defensive.
price stability
55 / 100
The shares can move around enough that you should expect some noise with the story.
source: institutional data
Institutional activity
89 buyers vs. 86 sellers in 4q2025. total institutional holdings: 86.0M shares.
source: institutional data
Price targets
3-5 year target range
$14
$35
$27
current price
$25
target midpoint · 9% from current · 3-5yr high: $35 (+25% · 7% ann'l return)
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