Value
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.0 |
| P/S | 7.3 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 6.2 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 20.7x
- ▸PEG: 0.14
KN · Why this verdict
Why Knowles (KN) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Three consecutive earnings beats, a confirmed breakout technical setup, and solid business quality metrics present a fundamentally sound profile, but the stock already trades above its near-term resistance target with downside exceeding upside and high customer concentration representing a structural vulnerability that could impair the earnings stream.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Approximately 76% of revenues flow from just five customers, creating a structurally fragile revenue base — a material reduction in business from any single key account could have a disproportionate impact on reported results and the growth narrative. Bear case | Top-five customer revenue concentration declines below 65% over the next four reported quarters as new customer relationships are established. | ↓Deteriorating |
| CounterHigh concentration among a small number of sophisticated customers in this industry can reflect deep technical integration and long product-design cycles that make switching costly; if these relationships are entrenched, the concentration signals partnership depth rather than customer dependency risk. | ||
After an in-line quarter at the oldest point in the lookback, the company has delivered three consecutive earnings beats — with the most recent coming in approximately 14% above estimates — indicating a disciplined guidance practice and steady operational delivery. Earnings | Earnings beats continue in at least three of the next four reported quarters, extending the streak. | ↑Improving |
| CounterBeat margins have varied between roughly 2% and 14% across the three recent quarters; the narrower beats may reflect estimates catching up to actual performance, making consistent outperformance harder to sustain as the guidance bar resets higher. | ||
A golden cross pattern — shorter-term moving averages crossing above longer-term ones — combined with RSI at 62 and a constructive MACD configuration signals that price momentum is firmly positive and the technical trend is intact. Engine gate (passed) | Price remains above the 200-day moving average with RSI holding between 50 and 75 for at least 60 consecutive days. | ↑Improving |
| CounterThe stock already trades above its near-term resistance target, meaning the breakout may be fully priced; at current levels there is more measured downside than remaining upside to target, limiting the practical value of the technical setup for new entrants. | ||
The stock trades above its near-term resistance target with downside to support exceeding upside to the target — a configuration where new buyers absorb more risk than available reward, making current price levels an unattractive entry point even for a fundamentally sound business. Engine gate (failed) | The stock pulls back enough to provide at least 10% upside to the near-term target, or analyst price targets advance to restore favorable asymmetry. | ↑Improving |
| CounterThe very low put/call ratio below 0.2 reflects near-universal near-term bullishness among options market participants; if this sentiment continues to draw buyers, the stock could extend above the current target while analysts revise targets upward, making the current entry look prescient in hindsight. | ||
Approximately 76% of revenues flow from just five customers, creating a structurally fragile revenue base — a material reduction in business from any single key account could have a disproportionate impact on reported results and the growth narrative.
↓DeterioratingBear case
- Expectation
- Top-five customer revenue concentration declines below 65% over the next four reported quarters as new customer relationships are established.
CounterHigh concentration among a small number of sophisticated customers in this industry can reflect deep technical integration and long product-design cycles that make switching costly; if these relationships are entrenched, the concentration signals partnership depth rather than customer dependency risk.
After an in-line quarter at the oldest point in the lookback, the company has delivered three consecutive earnings beats — with the most recent coming in approximately 14% above estimates — indicating a disciplined guidance practice and steady operational delivery.
↑ImprovingEarnings
- Expectation
- Earnings beats continue in at least three of the next four reported quarters, extending the streak.
CounterBeat margins have varied between roughly 2% and 14% across the three recent quarters; the narrower beats may reflect estimates catching up to actual performance, making consistent outperformance harder to sustain as the guidance bar resets higher.
A golden cross pattern — shorter-term moving averages crossing above longer-term ones — combined with RSI at 62 and a constructive MACD configuration signals that price momentum is firmly positive and the technical trend is intact.
↑ImprovingEngine gate (passed)
- Expectation
- Price remains above the 200-day moving average with RSI holding between 50 and 75 for at least 60 consecutive days.
CounterThe stock already trades above its near-term resistance target, meaning the breakout may be fully priced; at current levels there is more measured downside than remaining upside to target, limiting the practical value of the technical setup for new entrants.
The stock trades above its near-term resistance target with downside to support exceeding upside to the target — a configuration where new buyers absorb more risk than available reward, making current price levels an unattractive entry point even for a fundamentally sound business.
↑ImprovingEngine gate (failed)
- Expectation
- The stock pulls back enough to provide at least 10% upside to the near-term target, or analyst price targets advance to restore favorable asymmetry.
CounterThe very low put/call ratio below 0.2 reflects near-universal near-term bullishness among options market participants; if this sentiment continues to draw buyers, the stock could extend above the current target while analysts revise targets upward, making the current entry look prescient in hindsight.
Per-dimension breakdown
Quality
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.3 |
| ROA | 3.9 |
| Gross margin | 5.0 |
| Op margin | 7.0 |
| Net margin | 5.4 |
| Current ratio | 9.8 |
| FCF quality | 5.4 |
| Moat | 7.1 |
| Piotroski F | 10.0 |
- ▸Earnings quality warning: 72% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 7.6 |
| EPS growth | 6.1 |
- ▸Strong growth: 20% YoY
Momentum
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 7.5 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 3.3 |
- ▸Uptrend pullback (RSI 40) - buy opportunity
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 6.3 |
| Price target | 8.3 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (4.0) — signal dampened
- ▸Analyst upside: 27%
Insider
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.5 |
| notable moves | 5.0 |
- ▸Notable insider selling — $9,870,485 (0.333% of mkt cap)
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.1 |
| quality rank | 5.2 |
| growth rank | 3.9 |
Technical
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 6.2 |
| support resistance | 6.3 |
| 52w position | 6.2 |
| gap | 5.0 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.3 |
| days to cover | 3.8 |
| volatility | 1.0 |
| put call | 8.6 |
| implied vol | 3.5 |
| max pain risk | 3.0 |
| beta | 4.7 |
| debt equity | 9.3 |
- ▸Above max pain $25
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 6.3 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:5.0>=4.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:98d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.8<1.5@spot
Warning (2)
- MOMENTUM:5.0<5.5 (soft — BUY_NOW allowed but watch)
- INSIDER:0.33%=MODERATE
Reward-to-Risk
0.82
Upside
+7.7%
Downside
9.3%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.59>1.3, MCap $3.0B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 6.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.8<1.5@spot) reinforce the read. Current asymmetry R:R is 0.82 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 6.8, Sentiment at 6.6, and Catalyst at 6.6; the weakest are Insider at 3.9, Peer rank at 4.4, and Risk (lower is worse) at 5.0. The V9 engine flagged 1 failed gate with 2 warnings, producing an asymmetric reward-to-risk of 0.82 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Consistent Earnings Execution
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P2Breakout Technical Momentum
Trip ifPrice breaks below the 200-day moving average and closes below it for more than 10 consecutive sessions.
- P3Customer Concentration Revenue Fragility
Trip ifTop-5 customer revenue concentration falls below 60% for 2 consecutive reported quarters, demonstrating meaningful customer diversification.
- P4Above Target Unfavorable Entry
Trip ifStock rises more than 15% from current levels within 90 days, demonstrating the above-target entry did not constrain additional appreciation.