Goldman Sachs has adjusted its outlook on Timken, lowering its stock price target to $126 from $134 while keeping a Neutral rating. The industrial manufacturer's stock is currently trading at $106.63, down 7% over the past week. Analysts suggest the stock appears slightly overvalued relative to its Fair Value.
The firm raised its earnings estimates for fiscal years 2026, 2027, and 2028 to $6.50, $7.35, and $8.30 per share, respectively, up from prior estimates of $6.30, $7.05, and $8.00. These revisions follow Timken’s third-quarter 2026 results and initial fiscal 2027 growth framework.
Timken reported total segment EBITDA of $243 million, or $231 million excluding IEEPA tariff refunds, compared with the Visible Alpha consensus of $234 million. The company’s EBITDA over the last twelve months reached $926.6 million, supporting a market capitalization of $7.4 billion. Organic growth of 2.8% was in line with expectations, with Engineered Bearings up 0.5% and Industrial Motion up 7.3%.
The company raised its fiscal 2026 adjusted earnings per share guidance to a range of $6.35 to $6.50 from a prior range of $6.05 to $6.35. The guidance includes a $0.21 net earnings per share benefit from IEEPA tariff refunds and maintains an organic growth outlook of 3.5% at the midpoint.
For fiscal 2027, management expects organic growth in the mid-single digits, including the impact of an ongoing automotive original equipment exit. The recently completed belts divestiture is expected to add more than 200 basis points to Industrial Motion margins in fiscal 2027.
In other recent news, Timken reported stronger-than-expected third-quarter earnings for 2026. The company achieved adjusted earnings of $1.65 per share, surpassing Wall Street’s consensus estimate of $1.48. Revenue for the quarter was steady at $1.21 billion, aligning with analysts’ forecasts. Timken noted a 4.7% increase in revenue compared to the previous year, and its adjusted EBITDA margin expanded to 18.5%. Despite these positive results, investor focus appeared to shift towards the company’s future outlook and business mix.