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Timken Company
(NYSE:TKR)
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Rating:72Outperform
Price Target:
$157.00
▲(11.11% Upside)
Action:Reiterated
Date:08/04/26
The score is driven primarily by solid underlying financials (profitable operations, improving leverage, and consistently positive free cash flow) and a constructive technical uptrend. The latest earnings call adds upside support via raised guidance and improving margins, while the main offset is valuation—an elevated P/E with only a modest dividend yield.
Positive Factors
Consistent cash generation
Timken generates positive and rising free cash flow with strong operating cash flow in the quarter and an increased FY FCF guide. Durable cash generation supports reinvestment, M&A, dividends and buybacks, giving the company multi‑quarter financial flexibility even through cycles.
Negative Factors
Material leverage remains
Leverage has improved but the company still carries meaningful debt. With net leverage around mid‑range of targets, downturns or sustained margin pressure could limit capital allocation, increase borrowing costs under covenants, and constrain flexibility for opportunistic investments.
Read all positive and negative factors
Positive Factors
Negative Factors
Consistent cash generation
Timken generates positive and rising free cash flow with strong operating cash flow in the quarter and an increased FY FCF guide. Durable cash generation supports reinvestment, M&A, dividends and buybacks, giving the company multi‑quarter financial flexibility even through cycles.
Read all positive factors
Timken Company (TKR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$9.56B
Dividend Yield1.03%
Average Volume (3M)869.37K
Price to Earnings (P/E)31.1
Beta (1Y)1.11
Revenue Growth3.31%
EPS Growth-5.18%
CountryUS
Employees19,000
SectorIndustrials
Sector Strength72
IndustryManufacturing - Tools & Accessories
Share Statistics
EPS (TTM)3.71
Shares Outstanding69,494,510
10 Day Avg. Volume707,622
30 Day Avg. Volume869,368
Financial Highlights & Ratios
PEG Ratio-1.15
Price to Book (P/B)1.84
Price to Sales (P/S)1.28
P/FCF Ratio14.45
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$149.89Price Target Upside6.08% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)6.23
Revenue Forecast (FY)$4.84B
Timken Company Business Overview & Revenue Model
Company Description
The Timken Company operates globally, specializing in the design, manufacturing, and management of advanced bearings and power transmission solutions. Its business activities are organized into two main divisions: Mobile Industries and Process Ind...
How the Company Makes Money
Timken makes money primarily by selling engineered products for rotating equipment and motion systems to industrial and OEM customers, as well as to end users through the aftermarket. Its revenue model is largely product-sales driven: (1) Bearings...
Timken Company Earnings Call Summary
Earnings Call Date:Aug 04, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational execution, margin expansion, record Industrial Motion performance, successful M&A integration, and another upward revision to full-year guidance — outweighing manageable near-term headwinds (solar weakness, cost inflation, one-time tariff timing, and investments for aerospace capacity). Management presented credible actions (portfolio shaping, 80/20, leadership additions) expected to drive continued margin improvement toward 2028 targets.Positive Updates
Strategic Progress and M&A Integration
Progress on 'Elevate to Outperform': 80/20 engaged across 60% of enterprise revenue (target 75% by Q3). Bijur Delimon integration ahead of schedule, scaling lubrication systems to ~ $400M revenue and contributing ~$4M to adjusted EBITDA with high-teens margin. Belts divestiture on track (expected Q3) and pro forma IM EBITDA margin improvement >200 bps.
Negative Updates
Headwinds from Solar and Power & Electrification
Power and electrification was weaker, driven by a sizable decline in solar sales, which pressured that end market for the quarter.
Read all updates
Q2-2026 Updates
Positive
Negative
Strategic Progress and M&A Integration
Progress on 'Elevate to Outperform': 80/20 engaged across 60% of enterprise revenue (target 75% by Q3). Bijur Delimon integration ahead of schedule, scaling lubrication systems to ~ $400M revenue and contributing ~$4M to adjusted EBITDA with high-teens margin. Belts divestiture on track (expected Q3) and pro forma IM EBITDA margin improvement >200 bps.
Read all positive updates
Company Guidance
Timken raised full‑year 2026 guidance, now expecting total sales up 5%–6% (organic about 3.5% at the midpoint, +0.5% vs prior guide) with the Bijur Delimon acquisition contributing ~1% and currency ~1% (guidance still includes the belts business). Management sees adjusted EPS of $6.05–$6.35 (midpoint up $0.20 vs prior and implying ~16% growth at the midpoint, up from prior 13%), with Q3 and Q4 both up year‑over‑year and stronger growth expected in Q4. The midpoint implies consolidated adjusted EBITDA margins in the low‑18% range (vs 17.4% in 2025) and an incremental margin of >30% for the year; free cash flow is now expected at $375–$400 million (up $25 million). The EPS bridge reflects a $0.20–$0.25 tailwind from organic outperformance, an $0.08 per‑share benefit realized from IEEPA tariff refunds in Q2 (no H2 assumption), offset in guidance by a ~$0.10 per‑share headwind for incremental cost inflation and strategic investments.Timken Company Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
67
Positive
Cash Flow
63
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.76B | 4.58B | 4.57B | 4.77B | 4.50B | 4.13B |
| Gross Profit | 1.36B | 1.31B | 1.45B | 1.52B | 1.34B | 1.16B |
| EBITDA | 648.10M | 746.10M | 834.30M | 915.10M | 838.20M | 713.80M |
| Net Income | 258.70M | 288.40M | 352.70M | 394.10M | 407.40M | 369.10M |
Balance Sheet | ||||||
| Total Assets | 6.83B | 6.68B | 6.41B | 6.54B | 5.77B | 5.17B |
| Cash, Cash Equivalents and Short-Term Investments | 399.10M | 386.50M | 389.50M | 450.90M | 379.90M | 314.80M |
| Total Debt | 2.08B | 2.16B | 2.26B | 2.58B | 2.12B | 1.65B |
| Total Liabilities | 3.46B | 3.33B | 3.43B | 3.84B | 3.42B | 2.79B |
| Stockholders Equity | 3.19B | 3.18B | 2.83B | 2.58B | 2.27B | 2.29B |
Cash Flow | ||||||
| Free Cash Flow | 385.50M | 406.10M | 305.70M | 357.40M | 285.40M | 239.00M |
| Operating Cash Flow | 530.80M | 554.30M | 475.70M | 545.20M | 463.80M | 387.30M |
| Investing Cash Flow | -267.20M | -148.30M | -304.60M | -806.50M | -573.30M | -173.80M |
| Financing Cash Flow | -277.50M | -437.10M | -194.80M | 347.10M | 206.80M | -269.30M |
Timken Company Technical Analysis
Negative
141.30
Price Trends
137.14
Negative
122.56
Positive
106.23
Positive
Market Momentum
-1.39
Positive
41.85
Neutral
22.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TKR, the sentiment is Negative. The current price of 141.3 is above the 20-day moving average (MA) of 137.06, above the 50-day MA of 137.14, and above the 200-day MA of 106.23, indicating a neutral trend. The MACD of -1.39 indicates Positive momentum. The RSI at 41.85 is Neutral, neither overbought nor oversold. The STOCH value of 22.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TKR.
Timken Company Risk Analysis
Timken Company disclosed 31 risk factors in its most recent earnings report. Timken Company reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Timken Company Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $21.23B | 20.60 | 17.41% | 2.34% | 4.02% | 4.39% | |
72 Outperform | $9.56B | 31.12 | 8.13% | 1.00% | 3.31% | -5.18% | |
70 Outperform | $14.24B | 25.87 | 37.21% | 1.24% | 9.14% | 12.52% | |
70 Outperform | $17.44B | 54.21 | 9.66% | ― | 17.31% | 27.05% | |
68 Neutral | $14.28B | 23.18 | 6.90% | 3.64% | 0.57% | 29.85% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $2.59B | 18.98 | 10.46% | 2.27% | 7.16% | 28.79% |
* Industrials Sector Average
TKR
Timken Company
130.33
57.08
77.93%
KMT
Kennametal
33.13
13.36
67.57%
LECO
Lincoln Electric Holdings
281.96
46.75
19.88%
RBC
RBC Bearings
567.25
170.41
42.94%
SNA
Snap-on
416.35
103.80
33.21%
SWK
Stanley Black & Decker
103.89
38.05
57.80%
Timken Company Corporate Events
Business Operations and StrategyExecutive/Board Changes
Timken Appoints New Executive Vice President and COO
Positive
Jul 31, 2026
On July 29, 2026, Timken’s board appointed Stephen P. Ribaudo as executive vice president and chief operating officer, effective September 1, 2026, bringing leadership experience from Carrier Global and Collins Aerospace. Ribaudo’s com...
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Timken Company Secures New Long-Term Credit Facility
Positive
Jul 6, 2026
On July 2, 2026, Timken entered into a Sixth Amended and Restated Credit Agreement that replaces its December 5, 2022 revolving credit facility with a new $1.2 billion unsecured revolving credit line maturing July 2, 2031. The facility, provided b...
Executive/Board ChangesShareholder Meetings
Timken Grants EVP Incentive Awards, Shareholders Back Board
Positive
May 8, 2026
On May 8, 2026, Timken entered into a letter agreement with Executive Vice President and General Counsel Hansal N. Patel, granting him special treatment of certain existing and future short- and long-term incentive awards in recognition of his con...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.