Kennametal (NYSE:KMT) Issues Quarterly Earnings Results, Beats Expectations By $0.65 EPS

Kennametal (NYSE:KMT) posted its earnings results on Wednesday. The industrial products company reported $2.96 EPS for the quarter, topping the consensus estimate of $2.31 by $0.65, FiscalAI reports. Kennametal had a net margin of 14.53% and a return on equity of 24.83%. The business had revenue of $736.61 million for the quarter, compared to the consensus estimate of $725.74 million. During the same period last year, the company earned $0.34 EPS. The firm’s revenue was up 42.6% compared to the same quarter last year. Kennametal updated its Q1 2027 guidance to 2.500-2.800 EPS and its FY 2027 guidance to 4.150-5.150 EPS.

Here are the key takeaways from Kennametal’s conference call:

• Record fourth-quarter performance: Organic sales rose 42%, adjusted EBITDA margin reached 46.8%, and adjusted EPS increased to a record $2.96, supported by pricing, higher metal-cutting volumes, restructuring savings, and favorable tungsten price-cost timing.
• Management expects broad-based demand growth in fiscal 2027, with aerospace and defense, energy, and general engineering leading improvements; the company is targeting 1%–4% volume growth, including an estimated 1%–2% contribution from share gains.
• Fiscal 2027 sales are projected at $3.33 billion–$3.45 billion and adjusted EPS at $4.15–$5.15, with the midpoint of $4.65 roughly flat with fiscal 2026 as operational gains offset higher interest expense, Bolivia-related foreign-exchange pressure, taxes, and other headwinds.
• Elevated tungsten prices continue to weigh heavily on cash generation and working capital; fiscal 2026 free operating cash flow was negative $79 million, the share repurchase program remains paused, and management expects roughly a $200 million cash draw in fiscal 2027’s first quarter.
• The company strengthened liquidity and extended debt maturities, reporting approximately $926 million of cash and revolver availability and planning to draw a new $500 million term loan, while expecting free cash flow to turn positive in the second half of fiscal 2027 if tungsten prices remain stable.

Kennametal Trading Down 2.2%

Shares of NYSE:KMT traded down $0.74 during trading on Friday, reaching $33.11. The stock had a trading volume of 900,044 shares, compared to its average volume of 1,373,197. The firm’s fifty day moving average is $34.37 and its 200 day moving average is $36.40. The company has a debt-to-equity ratio of 0.42, a quick ratio of 0.99 and a current ratio of 2.62. Kennametal has a 52 week low of $19.80 and a 52 week high of $43.81. The stock has a market cap of $2.52 billion, a price-to-earnings ratio of 7.52, a P/E/G ratio of 0.35 and a beta of 1.36.

Kennametal Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, August 25th. Stockholders of record on Tuesday, August 11th will be given a $0.20 dividend. The ex-dividend date is Tuesday, August 11th. This represents a $0.80 dividend on an annualized basis and a dividend yield of 2.4%. Kennametal’s payout ratio is 45.20%.

Analyst Ratings Changes

Several equities analysts have recently issued reports on KMT shares. DA Davidson began coverage on shares of Kennametal in a research note on Tuesday, June 16th. They set a “neutral” rating and a $34.00 price target for the company. JPMorgan Chase & Co. reduced their price objective on shares of Kennametal from $40.00 to $34.00 and set an “underweight” rating on the stock in a research note on Monday, July 13th. Zacks Research downgraded Kennametal from a “strong-buy” rating to a “hold” rating in a report on Tuesday, July 14th. Morgan Stanley lowered their target price on Kennametal from $36.00 to $31.00 and set an “equal weight” rating for the company in a research report on Friday, July 17th. Finally, Barclays downgraded Kennametal from an “equal weight” rating to an “underweight” rating and cut their target price for the stock from $40.00 to $33.00 in a report on Wednesday, May 27th. Six analysts have rated the stock with a Hold rating and three have issued a Sell rating to the company. Based on data from MarketBeat, Kennametal has an average rating of “Reduce” and a consensus price target of $35.79.

Insider Transactions at Kennametal

In related news, VP Judith L. Bacchus sold 5,488 shares of Kennametal stock in a transaction on Monday, June 15th. The shares were sold at an average price of $35.94, for a total transaction of $197,238.72. Following the completion of the transaction, the vice president owned 4,554 shares of the company’s stock, valued at $163,670.76. This trade represents a 54.65% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Sagar A. Patel sold 29,499 shares of the company’s stock in a transaction on Monday, June 8th. The shares were sold at an average price of $33.50, for a total transaction of $988,216.50. The SEC filing for this sale provides additional information. Insiders sold a total of 47,000 shares of company stock worth $1,583,326 over the last three months. 1.43% of the stock is owned by company insiders.

Institutional Investors Weigh In On Kennametal

Several institutional investors and hedge funds have recently made changes to their positions in the business. Corient Private Wealth LLC acquired a new position in shares of Kennametal during the fourth quarter valued at about $217,000. Mercer Global Advisors Inc. ADV bought a new position in shares of Kennametal during the 4th quarter worth about $259,000. Cetera Investment Advisers acquired a new stake in shares of Kennametal in the 4th quarter valued at about $217,000. Walleye Trading LLC acquired a new stake in shares of Kennametal in the 4th quarter valued at about $228,000. Finally, Inspire Advisors LLC bought a new stake in Kennametal in the 4th quarter valued at about $262,000.

Kennametal Company Profile

Kennametal Inc is a global industrial technology company that designs and manufactures advanced materials, tooling systems, and engineered components for a range of demanding applications. Its solutions support precision metalworking, earthmoving, and wear-resistant environments, catering to customers seeking enhanced productivity, longer tool life, and reduced operating costs.

The company’s product portfolio spans indexable cutting tools, solid round tools, tool holders, metalworking fluid systems, wear parts, ceramics and composites, and custom-engineered components.