Kimball Electronics Q2 revenue slightly beats expectations on medical vertical strength

Overview

• Electronics manufacturer's Q2 revenue slightly beat analyst expectations despite a 5% decline

• Adjusted EPS for Q2 beat analyst expectations

• Company raised fiscal 2026 sales and adjusted operating income guidance

Outlook

• Company raises fiscal 2026 net sales guidance to $1,400 mln - $1,460 mln

• Kimball Electronics expects adjusted operating income of 4.2% - 4.5% of net sales

• Company maintains fiscal 2026 capital expenditures guidance at $50 mln - $60 mln

Result Drivers

• MEDICAL VERTICAL GROWTH - Sales in the medical vertical increased 15% year-over-year, driving strong performance in this sector

• MARGIN IMPROVEMENT - Adjusted operating income margin improved by 80 basis points year-over-year, reflecting better operational efficiency

• CASH FLOW - Company reported positive cash from operations for the eighth consecutive quarter, indicating strong cash management

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the semiconductors peer group is "buy"

• Wall Street's median 12-month price target for Kimball Electronics Inc is $32.50, about 4.6% above its February 3 closing price of $31.06

• The stock recently traded at 22 times the next 12-month earnings vs. a P/E of 22 three months ago

Press Release: ID:nBw5Tg6bha

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