Value
5.1/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.7 |
| P/S | 6.8 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 5.3 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 23.8x
- ▸PEG: 0.16
KN · Why this verdict
Why Knowles (KN) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score6.0/10
ConfidenceMEDIUM
MacroNEUTRAL
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. | →Stable |
| 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. | ↓Deteriorating |
| 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. | →Stable |
| 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. | →Stable |
| 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.
→StableBear 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.
↓DeterioratingEarnings
- 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.
→StableEngine 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.
→StableEngine 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
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.2 |
| ROA | 3.7 |
| Gross margin | 5.1 |
| Op margin | 6.1 |
| Net margin | 5.3 |
| Current ratio | 9.8 |
| FCF quality | 4.5 |
| Moat | 7.1 |
| Piotroski F | 10.0 |
- ▸Earnings quality warning: 58% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
8.1/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.1 |
| EPS growth | 10.0 |
Momentum
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 5.2 |
| MA position | 9.0 |
| Volume | 1.3 |
- ▸Above 200-day MA
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.5 |
| Analyst rating | 5.0 |
| Price target | 6.7 |
- ▸LLM news sentiment: +0.50 (n=1)
Insider
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Modest insider selling — $978,041 (0.030% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.5 |
| quality rank | 5.4 |
| growth rank | 3.6 |
Technical
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.6 |
| support resistance | 2.5 |
| 52w position | 8.2 |
| gap | 5.0 |
Risk (lower is worse)
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.9 |
| days to cover | 5.8 |
| volatility | 0.2 |
| put call | 6.7 |
| implied vol | 5.5 |
| beta | 4.6 |
| debt equity | 9.2 |
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 6.4 |
| news activity | 5.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- MOMENTUM:6.2>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:71d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.3=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.35
Upside
-4.7%
Downside
13.5%
Sizing output
AVOID
SetupBreakout — Golden cross, above all MAs, RSI 51, MACD bullish
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.61>1.3, MCap $3.3B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:6.2>=5.5. Top dim: Growth at 8.1; weakest: Peer rank at 4.5. No conviction either direction.
The strongest dimensions are Growth at 8.1, Sentiment at 6.3, and Catalyst at 6.3; the weakest are Peer rank at 4.5, Technical at 4.6, and Value at 5.1. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -0.35 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.