Are you on the lookout for a promising stock to add to your portfolio? Look no further than Knowles Corp (KN). This electronic components company is making waves in the market, and now might be the perfect time to buy. Let’s dive into why KN is a buy signal right now and how you can strategically manage your investment with a recommended trailing stop percentage.
1. Strong Financial Performance
Knowles Corp has demonstrated robust financial health, which is a key indicator for any potential investment. The company has consistently beaten its earnings estimates, showcasing its ability to perform well even in challenging market conditions. For instance, in the most recent quarter, KN reported an EPS of $0.20, surpassing the estimate of $0.18. This trend of outperforming expectations is a positive sign for investors.
Moreover, Knowles has shown impressive revenue growth. In the latest quarter, the company reported revenues of $196.4 million, a significant increase from the previous quarter. This growth trajectory indicates that Knowles is not only maintaining its market position but also expanding its reach and capabilities.
2. Attractive Valuation Metrics
When it comes to valuation, Knowles Corp stands out. The company has a trailing P/E ratio of 22.03 and a forward P/E ratio of 14.80. These figures suggest that KN is currently undervalued compared to its future earnings potential. Additionally, the PEG ratio of 14.80 indicates that the stock is reasonably priced given its expected growth rate.
The price-to-sales ratio of 2.29 further underscores the stock’s attractiveness. This metric shows that investors are paying a reasonable price for each dollar of the company’s sales, making KN a compelling buy from a valuation perspective.
3. Positive Market Sentiment
Market sentiment around Knowles Corp is overwhelmingly positive. The stock has seen a 9.33% increase over the past month, reflecting growing investor confidence. Year-to-date, KN has risen by 5.56%, and over the past year, it has gained 7.63%. These upward trends indicate that the market recognizes the company’s potential and is optimistic about its future performance.
4. Technical Indicators Support a Buy
Technical analysis also supports the case for buying KN. The stock’s RSI (Relative Strength Index) is at 45.12, which is comfortably within the neutral range. This suggests that the stock is neither overbought nor oversold, providing a balanced entry point for investors.
Additionally, the stock’s current price of $18.70 is well-supported by its moving averages. The latest EMA (Exponential Moving Average) and SMA (Simple Moving Average) both indicate a stable upward trend, reinforcing the buy signal.
5. Strategic Trailing Stop Percentage
Given KN’s recent performance and moderate volatility, a 7% trailing stop is recommended. This percentage allows for normal price fluctuations while protecting your investment from significant downside risk. A trailing stop helps you lock in profits as the stock price rises, ensuring that you benefit from upward movements while minimizing potential losses.
Conclusion
Knowles Corp (KN) presents a compelling investment opportunity right now. With strong financial performance, attractive valuation metrics, positive market sentiment, and supportive technical indicators, KN is well-positioned for future growth. By implementing a 7% trailing stop, you can strategically manage your investment and maximize your returns.
So, why wait? Consider adding Knowles Corp to your portfolio today and enjoy the sound investment opportunity it offers!
Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Always conduct your own research or consult a financial advisor before making any investment decisions.