Knowles (NYSE:KN) Shares Gap Up After Better-Than-Expected Earnings

Key Points

• Knowles beat quarterly expectations: EPS came in at $0.38 versus the $0.36 consensus, while revenue reached $184 million, exceeding estimates of $172.1 million and rising 20.3% year over year.
• Fourth-quarter guidance was above analyst forecasts: Management expects EPS of $0.39–$0.43 and revenue of $180 million–$190 million, compared with consensus estimates of $0.36 and $174.5 million, respectively.
• Investor sentiment remains mixed: Shares initially gapped higher, but the stock remains below its 50-day and 200-day moving averages; analysts maintain a “Moderate Buy” consensus while Susquehanna cut its price target and recent insider activity has consisted of sales.

Knowles Corporation (NYSE:KN - Get Free Report)'s share price gapped up before the market opened on Friday after the company announced better than expected quarterly earnings. The stock had previously closed at $33.38, but opened at $34.67. Knowles shares last traded at $33.4350, with a volume of 190,421 shares changing hands.

The communications equipment provider reported $0.38 EPS for the quarter, topping analysts' consensus estimates of $0.36 by $0.02. The firm had revenue of $184.00 million during the quarter, compared to analyst estimates of $172.10 million. Knowles had a net margin of 10.63% and a return on equity of 11.45%. The business's revenue for the quarter was up 20.3% on a year-over-year basis. During the same period in the previous year, the business posted $0.33 earnings per share.

Knowles News Summary

Here are the key news stories impacting Knowles this week:

• Positive Sentiment: Knowles reported third-quarter 2026 EPS of $0.38, ahead of the $0.36 consensus estimate, while revenue reached $184.0 million versus expectations of approximately $172.1 million. Revenue increased 20.3% year over year, supporting the company’s growth outlook. Knowles quarterly earnings results
• Positive Sentiment: Management issued fourth-quarter guidance above analyst expectations, calling for EPS of $0.39-$0.43 versus the $0.36 consensus and revenue of $180 million-$190 million versus the $174.5 million consensus. The outlook suggests continued operating momentum and is the clearest potential catalyst for the stock. Knowles beats expectations and provides guidance
• Positive Sentiment: Profitability and cash generation improved in the quarter, with operating profit reported at $30.7 million, net income at $21.6 million and operating cash flow at $44.6 million. These results strengthen the fundamental case, although some reported financial figures differ across third-party summaries. Knowles third-quarter earnings performance
• Neutral Sentiment: Despite the earnings beat, Knowles trades below its 50-day and 200-day moving averages, indicating that technical momentum remains weak and investors may be waiting for further confirmation of the improved outlook.
• Negative Sentiment: Susquehanna lowered its price target for Knowles, potentially signaling that the broker sees limited near-term upside even after the company’s earnings beat. Susquehanna cuts Knowles price target
• Negative Sentiment: Recent insider activity has been exclusively selling, with executives reportedly making no open-market purchases during the past six months. While insider sales may reflect personal liquidity needs, the absence of buying can weigh on investor sentiment. Knowles insider trading activity

Analysts Set New Price Targets

A number of research firms recently issued reports on KN. Zacks Research downgraded shares of Knowles from a "strong-buy" rating to a "hold" rating in a report on Tuesday, September 22nd. Robert W. Baird set a $50.00 target price on shares of Knowles in a report on Friday. Susquehanna decreased their price target on shares of Knowles from $40.00 to $35.00 and set a "neutral" rating on the stock in a research report on Wednesday. Wall Street Zen cut shares of Knowles from a "strong-buy" rating to a "buy" rating in a research note on Saturday, August 1st. Finally, Weiss Ratings upgraded shares of Knowles from a "hold (c+)" rating to a "buy (b-)" rating in a research note on Thursday, October 8th. Three analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company's stock. According to MarketBeat.com, Knowles presently has a consensus rating of "Moderate Buy" and a consensus price target of $41.00.

Insider Activity at Knowles

In other Knowles news, SVP Raymond Cabrera sold 6,178 shares of the firm's stock in a transaction dated Monday, July 27th. The stock was sold at an average price of $36.28, for a total transaction of $224,137.84. Following the sale, the senior vice president directly owned 127,945 shares of the company's stock, valued at $4,641,844.60. This trade represents a 4.61% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Cheryl Shavers sold 6,618 shares of the business's stock in a transaction dated Monday, August 17th. The shares were sold at an average price of $39.27, for a total value of $259,888.86. Following the completion of the transaction, the director owned 35,723 shares in the company, valued at $1,402,842.21. The trade was a 15.63% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 2.24% of the stock is owned by insiders.

Institutional Trading of Knowles

A number of institutional investors and hedge funds have recently bought and sold shares of the stock. BlackRock Inc. bought a new position in shares of Knowles during the 2nd quarter valued at approximately $571,614,000. Legal & General Group Plc purchased a new stake in Knowles during the second quarter valued at $8,698,000. Hodges Capital Management Inc. lifted its position in Knowles by 66.2% during the first quarter. Hodges Capital Management Inc. now owns 217,386 shares of the communications equipment provider's stock valued at $5,582,000 after purchasing an additional 86,563 shares during the last quarter. Andar Capital Management HK Ltd bought a new position in Knowles during the second quarter valued at $4,853,000. Finally, Bank of America Corp DE purchased a new position in shares of Knowles in the 2nd quarter worth $30,158,000. 96.35% of the stock is currently owned by institutional investors.

Knowles Stock Up 0.2%

The business's 50 day simple moving average is $35.85 and its 200 day simple moving average is $35.90. The company has a current ratio of 3.20, a quick ratio of 1.75 and a debt-to-equity ratio of 0.16. The firm has a market capitalization of $2.86 billion, a PE ratio of 43.45 and a beta of 1.59.

About Knowles

Knowles Corporation NYSE: KN is a global manufacturer of advanced electronic components and solutions for audio, communications, medical, industrial and other specialized applications. The company develops products that support sound capture, audio processing, signal management and high-performance connectivity in a range of electronic devices and systems.

Its portfolio includes microelectromechanical systems (MEMS) microphones, audio processors, speakers, receivers, balanced armature drivers and other acoustic components.

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