Zacks Investment Research Downgrades Kennametal (NYSE:KMT) to Hold

Kennametal (NYSE:KMT) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research note issued to investors on Monday, Zacks.com reports. They currently have a $29.00 target price on the industrial products company’s stock. Zacks Investment Research‘s price objective points to a potential upside of 1.93% from the stock’s current price.

According to Zacks, “Kennametal is poised to benefit from its diversified business structure, solid liquidity position and innovation capabilities. Its simplification/modernization activities are predicted to yield annualized savings of $30-$35 million in fiscal 2020 and $65-$75 million in fiscal 2021. Also, its policy of rewarding shareholders with dividends bodes well. However, the company is wary of the adverse impacts of the pandemic and it, therefore, suspended its financial projections for fiscal 2020. Notably, its cost-saving measures might be of help in the quarters ahead. In addition, weakness in gross and operating margins as well as forex woes might prove challenging. Year to date, the company’s shares have underperformed the industry. Also, its earnings estimates have declined for fiscal 2020 and fiscal 2021 in the past 30 days.”

KMT has been the topic of several other reports. Morgan Stanley started coverage on Kennametal in a report on Friday, June 26th. They issued an “equal weight” rating and a $33.00 target price on the stock. KeyCorp boosted their target price on Kennametal from $30.00 to $38.00 and gave the stock an “overweight” rating in a report on Thursday, June 11th. Barclays reissued a “buy” rating and issued a $27.00 target price on shares of Kennametal in a report on Sunday, March 22nd. Wells Fargo & Co boosted their target price on Kennametal from $30.00 to $35.00 and gave the stock an “overweight” rating in a report on Wednesday, June 3rd. Finally, BMO Capital Markets upped their price target on Kennametal from $18.00 to $29.00 in a report on Wednesday, June 10th. Two research analysts have rated the stock with a sell rating, five have assigned a hold rating and four have given a buy rating to the company’s stock. The stock has a consensus rating of “Hold” and an average target price of $31.78.

Shares of KMT stock opened at $28.45 on Monday. The stock has a market cap of $2.26 billion, a price-to-earnings ratio of 36.47, a PEG ratio of 5.99 and a beta of 2.38. The business’s fifty day moving average is $27.20 and its 200 day moving average is $28.14. Kennametal has a twelve month low of $14.45 and a twelve month high of $38.73. The company has a quick ratio of 1.17, a current ratio of 2.52 and a debt-to-equity ratio of 0.48.

Kennametal (NYSE:KMT) last issued its quarterly earnings results on Monday, May 4th. The industrial products company reported $0.46 earnings per share for the quarter, topping the Thomson Reuters’ consensus estimate of $0.32 by $0.14. Kennametal had a return on equity of 10.16% and a net margin of 3.10%. The company had revenue of $483.10 million for the quarter, compared to analysts’ expectations of $503.23 million. During the same period in the prior year, the firm earned $0.77 earnings per share. The firm’s revenue for the quarter was down 19.1% on a year-over-year basis. Equities research analysts expect that Kennametal will post 0.91 earnings per share for the current fiscal year.

In other Kennametal news, Director Lawrence W. Stranghoener sold 7,000 shares of the company’s stock in a transaction dated Wednesday, June 3rd. The stock was sold at an average price of $30.06, for a total value of $210,420.00. Following the completion of the sale, the director now owns 26,108 shares in the company, valued at $784,806.48. The sale was disclosed in a document filed with the SEC, which is accessible through this link. Also, VP Judith L. Bacchus sold 10,000 shares of the company’s stock in a transaction dated Wednesday, June 10th. The stock was sold at an average price of $27.92, for a total value of $279,200.00. Following the completion of the sale, the vice president now owns 38,157 shares of the company’s stock, valued at approximately $1,065,343.44. The disclosure for this sale can be found here. In the last three months, insiders sold 26,750 shares of company stock worth $730,280. 1.48% of the stock is owned by corporate insiders.

A number of institutional investors and hedge funds have recently modified their holdings of the business. Wellington Management Group LLP increased its position in Kennametal by 36.8% in the first quarter. Wellington Management Group LLP now owns 8,132,544 shares of the industrial products company’s stock worth $151,427,000 after buying an additional 2,188,320 shares in the last quarter. Ariel Investments LLC grew its position in shares of Kennametal by 3.0% during the fourth quarter. Ariel Investments LLC now owns 5,746,294 shares of the industrial products company’s stock worth $211,981,000 after purchasing an additional 168,981 shares in the last quarter. Invesco Ltd. grew its position in shares of Kennametal by 4.9% during the first quarter. Invesco Ltd. now owns 3,706,269 shares of the industrial products company’s stock worth $69,011,000 after purchasing an additional 171,552 shares in the last quarter. Alliancebernstein L.P. grew its position in shares of Kennametal by 23.8% during the first quarter. Alliancebernstein L.P. now owns 3,574,494 shares of the industrial products company’s stock worth $66,557,000 after purchasing an additional 686,785 shares in the last quarter. Finally, Janus Henderson Group PLC grew its position in shares of Kennametal by 1.9% during the fourth quarter. Janus Henderson Group PLC now owns 2,814,057 shares of the industrial products company’s stock worth $103,811,000 after purchasing an additional 52,759 shares in the last quarter. Institutional investors and hedge funds own 96.00% of the company’s stock.

Kennametal Company Profile

Kennametal Inc develops and applies tungsten carbides, ceramics, super-hard materials, and solutions for use in metal cutting and mission-critical wear applications to combat extreme conditions related with wear fatigue, corrosion, and high temperatures worldwide. The company operates through three segments: Industrial, Widia, and Infrastructure.

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