KN
Knowles Corporation
$36.66
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 80.8% above fair value
You pay
$36.66
Bear
$16.22
Fair
$20.27
Bull
$24.33
Bear
$16.22
-55.8%
$0.63 × 18x P/E
Fair
$20.27
-44.7%
$0.63 × 22x P/E
Bull
$24.33
-33.6%
$0.63 × 27x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
58.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $38.50 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $20.27 per share.
Warnings
Wall Street's average price target is $38.50 (from 15 analysts). Our estimate is 63% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples