Qnity Electronics, Inc. (Q) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Qnity Electronics, Inc.

Updated on October 16, 2026 · accounts published on August 4, 2026

Reading of October 15, 2026: A profitable business with strong cash flow

Qnity Electronics trades at a P/E of 42.7 over the last 12 months, 30 % above its sector median, while EPS slipped 0.3 %.

• Is Qnity Electronics expensive or cheap? Its P/E of 42.7 over the last 12 months sits 30 % above the 33.0 median of 360 sector peers.
• How is the business doing? Revenue rose almost 10 % over the last 12 months, but EPS slipped 0.3 % and ROIC of 6.1 % trails the 8.2 % sector median.
• How strong is the balance sheet? Net debt was 2.9× EBITDA in fiscal 2025, above the 2.0× ceiling considered tolerable for semiconductors.
• What to expect from the next earnings? Analysts expect EPS of $1.20 on November 4, 2026; all 4 analysts covering the stock rate it a buy.
• Is it growing with real cash or by diluting shareholders? Free cash flow was 21 % of revenue in fiscal 2025 and stock pay only 0.4 %, but revenue per share was flat over 2022-2025.

Is Qnity Electronics expensive or cheap?

Qnity Electronics trades at a P/E of 42.7 over the last 12 months, 30 % above the 33.0 median of its sector. EPS fell 0.3 % over the same period, so recent earnings growth does not support the premium. EV/EBITDA of 19.7× is also above its three-year average of 16.6×, past the 110 % line that marks an expensive multiple. The free cash flow yield of 4.8 % looks better than the 3.3 % earnings yield. The shares are 32 % below their 52-week high of $175.64 but still far above the $73.54 low.

How is the business doing?

Over the last 12 months revenue grew 9.7 %, yet EPS edged down 0.3 %, so growth in sales is not reaching shareholders. An operating margin of 21 % and a net margin of 11 % show a profitable operation, but returns on capital are thin: ROIC of 6.1 % is 2.1 points below the 8.2 % median of 466 sector peers, and ROE stands at 7.6 %. The gross margin of 42 % in fiscal 2025 sits just under the 45 % that marks a healthy semiconductor business, which points to limited pricing power.

How strong is the balance sheet?

Net debt came to $19.72 per share in fiscal 2025 ($24.08 of debt against $4.37 of cash), equal to 17 % of the current share price. Measured against earnings, net debt of 2.9× EBITDA exceeds the 2.0× level tolerated in semiconductors. Short-term liquidity is comfortable, with a current ratio of 2.01, and debt to equity of 0.55 over the last 12 months is moderate. An Altman Z of 2.2 puts the company in the grey zone, and a Piotroski score of 5 out of 9 is middling. With a 0.2 % dividend yield and a 2 % payout in fiscal 2025, cash goes almost entirely to other uses.

What to expect from the next earnings?

Qnity Electronics reports on November 4, 2026, and the consensus calls for EPS of $1.20 for the quarter. The company has beaten EPS estimates in each of the last 4 quarters, most recently on August 4, 2026, with $1.19 against $1.07 expected, an 11 % surprise. Expectations are steady: the 2026 EPS consensus barely moved in the last 30 days, from $4.55 to $4.56, and the revenue estimate rose 0.6 %. Coverage is thin, with only 4 analysts, all at buy, so a single change of view would carry a lot of weight.

Is it growing with real cash or by diluting shareholders?

In technology, stock-based pay can flatter reported earnings and multiples assume growth, so the useful checks are cash conversion, dilution, pricing power and growth per share. Qnity Electronics passes the first two: free cash flow equaled 20.8 % of revenue in fiscal 2025, just above the 20 % healthy mark, and stock compensation was 0.4 % of revenue, far below the 10 % limit. Growth is the weak point: revenue per share was flat from fiscal 2022 to 2025, against the 15 % a year expected of a healthy tech company, and ROIC of 6.1 % falls well short of the 15 % benchmark.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.