Taking on analysts’ expectations and winning: Knowles Corporation (KN)

Knowles Corporation (NYSE: KN) stock fell -4.81% on Friday to $15.84 against a previous-day closing price of $16.64. With 1.55 million shares changed hands, the volume of the stock remained heavier than its average volume of 0.73 million shares. During the session, the Communication Equipment company that operates in wider Technology sector, reached to the highest price of $16.55 whereas the lowest price it dropped to was $15.72. The 52-week range on KN shows that it touched its highest point at $23.81 and its lowest point at $15.40 during that stretch. It currently has a 1-year price target of $20.80. Beta for the stock currently stands at 1.37.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of KN was down-trending over the past week, with a drop of -16.94%, but this was down by -9.43% over a month. Three-month performance dropped to -14.93% while six-month performance fell -25.07%. The stock lost -21.31% in the past year, while it has lost -32.16% so far this year. A look at the trailing 12-month EPS for KN yields -1.17 with Next year EPS estimates of 1.55. For the next quarter, that number is 0.25. This implies an EPS growth rate of 7.80% for this year and 16.67% for next year. EPS is expected to grow by 15.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 48.00%.

Float and Shares Shorts:

At present, 92.00 million KN shares are outstanding with a float of 90.24 million shares on hand for trading. On Jul 14, 2022, short shares totaled 3.5 million, which was 3.81% higher than short shares on Jun 14, 2022. In addition to Mr. Jeffrey S. Niew as the firm’s Pres, CEO & Director, Mr. John S. Anderson serves as its Sr. VP, CFO & Interim Principal Accounting Officer.

Institutional Ownership:

Through their ownership of 102.34% of KN’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 67.12% of KN, in contrast to 33.13% held by mutual funds. Shares owned by individuals account for 2.39%. As the largest shareholder in KN with 15.76% of the stake, BlackRock Fund Advisors holds 14,464,136 shares worth 14,464,136. A second-largest stockholder of KN, The Vanguard Group, Inc., holds 10,086,964 shares, controlling over 10.99% of the firm’s shares. Franklin Mutual Advisers LLC is the third largest shareholder in KN, holding 9,217,602 shares or 10.05% stake. With a 7.05% stake in KN, the iShares Core S&P Small Cap ETF is the largest stakeholder. A total of 6,470,318 shares are owned by the mutual fund manager. The Franklin Small Cap Value Fund, which owns about 7.04% of KN stock, is the second-largest Mutual Fund holder. It holds 6,461,119 shares valued at 111.97 million. Vanguard Total Stock Market Index holds 2.94% of the stake in KN, owning 2,697,342 shares worth 46.74 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for KN since 5 analysts follow the stock currently. There are 2 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 2 believe that the stock is worth HOLDING, 1 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With KN analysts setting a high price target of $27.00 and a low target of $17.00, the average target price over the next 12 months is $20.80. Based on these targets, KN could surge 70.45% to reach the target high and rise by 7.32% to reach the target low. Reaching the average price target will result in a growth of 31.31% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. KN will report FY 2022 earnings on 02/08/2023. Analysts have provided yearly estimates in a range of $1.29 being high and $1.20 being low. For KN, this leads to a yearly average estimate of $1.24. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Knowles Corporation surprised analysts by $0.01 when it reported $0.33 EPS against a consensus estimate of $0.32. The surprise factor in the prior quarter was $0.05. Based on analyst estimates, the high estimate for the next quarter is $0.21 and the low estimate is $0.18. The average estimate for the next quarter is thus $0.19.

Summary of Insider Activity:

Insiders traded KN stock several times over the past three months with 1 Buys and 3 Sells. In these transactions, 100,000 shares were bought while 82,124 shares were sold. The number of buy transactions has increased to 37 while that of sell transactions has risen to 44 over the past year. The total number of shares bought during that period was 1,278,080 while 1,022,718 shares were sold.

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