Knowles Insiders Sell $9.8M After Four-Quarter Beat Streak
Four Knowles executives sold $9.83 million of stock in August at prices above where shares now trade, with zero purchases across CEO, CFO, Chief HR Officer, and a board director. The sell-off follows
Knowles Insiders Sell $9.8M After Four-Quarter Beat Streak
NEW YORK, August 27 —
Knowles Corporation (KN) has beaten analyst EPS estimates four quarters straight, yet its CEO and CFO sold $9.39 million of stock over three August days at prices the stock has since fallen below. Four executives liquidated $9.83 million with zero purchases, while the analyst consensus implies 25% upside. The insider signal and the analyst target cannot both be right.
- CEO Niew sold 200,000 shares at $38.00, $39.07 over three August days; shares now trade at $34.96.
- Aggregate 90-day insider net selling: $9.83 million across CEO, CFO, Chief HR Officer, and a director; zero purchases.
- Trailing revenue $640M, up 14.3% year-over-year; forward P/E 21.6x; analyst consensus target $43.75 implies 25% upside.
The Selling Pattern
CEO Jeffrey Niew's largest single move, 150,000 shares at $39.07 on August 12 for $5.86 million, landed during a week when Knowles shares rose 6.81%. CFO John S. Anderson sold 30,000 shares that same day. Niew returned August 13 and 14 for another $1.93 million; Anderson followed with $388,400 the next session. The Chief HR Officer sold first, four days after the July 23 earnings 8-K, and a board director joined the tally on August 17. Coordination across four roles with no offsetting purchases is not a routine compensation-driven diversification pattern.
Genuine Business, Modest Free Cash Flow
Knowles makes precision capacitors and RF/microwave filters for defense, medtech, EV, and industrial markets through its Precision Devices segment, and balanced armature speakers and microphones for hearing health through its Medtech & Specialty Audio unit, both skewing toward specialty, lower-volume demand. Trailing revenue reached $640 million on 14.3% growth, with a 45.3% gross margin. The four-quarter beat streak (EPS surprises of 6.5%, 2.3%, 12.6%, and 9.8%) is real, and the DCF math at those margins is not obviously wrong. But trailing FCF of $39 million against $150 million in debt leaves limited cushion at 21.6x forward earnings.
| Ticker | Mkt cap | Fwd P/E | 52-wk |
|---|---|---|---|
| KN | $3.0B | 21.6x | +59.0% |
| EVTC | $1.8B | 6.7x | -17.6% |
| MEI | $631M | 43.0x | +118.7% |
| CTS | $1.6B | 19.4x | +32.8% |
| CNXN | $2.0B | 18.0x | +23.8% |
| BHE | $2.6B | 22.3x | +74.4% |
Which Signal to Trust
The stock sits at $34.96, below every sale price the CEO and CFO executed in August ($38.00, $39.07). Short interest at 9.0% of the float and a GuruFocus overvaluation flag offer independent corroboration. Institutional ownership at 104.5% of shares outstanding (above 100% because short-selling offsets long positions) points to the same ambivalence. The bull thesis rests on a $43.75 analyst target and the beat streak; a miss on next quarter's EPS consensus would confirm what the Form 4 filings appear to be pricing in. For the live numbers, run the free Knowles Corporation deep-dive →
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Frequently Asked Questions
Why are Knowles Corporation insiders selling stock?
CEO Jeffrey Niew sold 200,000 shares at $38.00 to $39.07 across three August days, and CFO John S. Anderson sold shares on the same dates. Four executives, including the Chief HR Officer and a board director, liquidated $9.83 million with zero offsetting purchases. The article notes that coordination across four roles with no purchases is not a routine compensation-driven diversification pattern.
Is Knowles Corporation stock undervalued?
The analyst consensus target of $43.75 implies 25% upside from the current price of $34.96. However, trailing free cash flow of $39 million against $150 million in debt provides limited cushion at 21.6x forward earnings, and the coordinated insider selling at prices the stock has since fallen below represents a competing signal.
What does Knowles Corporation do?
Knowles manufactures precision capacitors and RF/microwave filters for defense, medtech, EV, and industrial markets through its Precision Devices segment. It also produces balanced armature speakers and microphones for hearing health through its Medtech Specialty Audio unit, both oriented toward specialty, lower-volume demand.
Has Knowles beaten earnings estimates recently?
Knowles has beaten analyst EPS estimates four consecutive quarters, with surprises of 6.5%, 2.3%, 12.6%, and 9.8%. Trailing revenue reached $640 million on 14.3% year-over-year growth, with a gross margin of 45.3%.
What is the short interest in Knowles stock?
Short interest stands at 9.0% of the float. Institutional ownership is reported at 104.5% of shares outstanding, a figure above 100% because short-selling offsets long positions, which the article characterizes as reflecting market-wide ambivalence about the stock's near-term direction.
Knowles Corporation's CEO and CFO sold a combined $9.39 million of stock in open-market transactions over three days in August, joined by two other executives in $9.83 million of aggregate 90-day net insider sales — all at prices above where the stock trades today. The selling arrives as Knowles has beaten analyst EPS estimates in each of its last four consecutive quarters and the analyst consensus target implies roughly 25% upside.