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Here's Why it is Worth Investing in Kennametal (KMT) Stock
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Kennametal Inc. (KMT - Free Report) currently boasts robust prospects on strength across its end markets, solid product portfolio, growth initiatives and a sound capital-deployment strategy.
Notably, the Zacks Rank #2 (Buy) company has a market capitalization of $6.6 billion. In the past six months, it has gained 23.5% compared with the industry’s growth of 8.3%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
Solid End Markets: Kennametal is poised to benefit from improvements in general engineering and transportation end markets in the quarters ahead. Also, going forward, the company expects to gain from simplification activities, innovation capabilities and solid product offerings. Notably, for the third quarter of fiscal 2021 (ending March 2021), it anticipates sales to grow in mid- to high-single digits on a sequential basis.
Initiatives: Of late, the company’s three initiatives — growth, modernization and simplification — have been proving beneficial. These initiatives have been helping it in improving its commercial execution and operational efficiency apart from lowering operational costs and contributing to strong operating leverage. It’s worth mentioning here that compared with the year-ago quarter, the initiatives boosted Kennametal's bottom line by 19 cents per share in the second quarter of fiscal 2021 (ended December 2020). Notably, the initiatives are expected to yield benefits of $80 million in fiscal 2021 (ending June 2021).
Rewards to Shareholders: It remains committed to rewarding shareholders through dividend payouts. In the first half of fiscal 2021, the company distributed dividends totaling 40 cents per share or $33.3 million to its shareholders.
Estimate Trend: In the past 30 days, analysts have increasingly become bullish on the company, as evident from positive earnings estimate revisions. The Zacks Consensus Estimate for its fiscal 2021 earnings has trended up from 73 cents to 75 cents on one upward estimate revision against none downward. In addition, over the same timeframe, the consensus estimate for fiscal 2022 (ending June 2022) earnings has trended up from $1.50 to $1.51 on one upward estimate revisions against none downward.
Astec delivered a positive earnings surprise of 172.72%, on average, in the trailing four quarters.
Acco Brands delivered a positive earnings surprise of 278.70%, on average, in the trailing four quarters.
Kadant delivered a positive earnings surprise of 30.95%, on average, in the trailing four quarters.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
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Here's Why it is Worth Investing in Kennametal (KMT) Stock
Kennametal Inc. (KMT - Free Report) currently boasts robust prospects on strength across its end markets, solid product portfolio, growth initiatives and a sound capital-deployment strategy.
Notably, the Zacks Rank #2 (Buy) company has a market capitalization of $6.6 billion. In the past six months, it has gained 23.5% compared with the industry’s growth of 8.3%.
Let’s delve into the factors that make investment in the company a smart choice at the moment.
Solid End Markets: Kennametal is poised to benefit from improvements in general engineering and transportation end markets in the quarters ahead. Also, going forward, the company expects to gain from simplification activities, innovation capabilities and solid product offerings. Notably, for the third quarter of fiscal 2021 (ending March 2021), it anticipates sales to grow in mid- to high-single digits on a sequential basis.
Initiatives: Of late, the company’s three initiatives — growth, modernization and simplification — have been proving beneficial. These initiatives have been helping it in improving its commercial execution and operational efficiency apart from lowering operational costs and contributing to strong operating leverage. It’s worth mentioning here that compared with the year-ago quarter, the initiatives boosted Kennametal's bottom line by 19 cents per share in the second quarter of fiscal 2021 (ended December 2020). Notably, the initiatives are expected to yield benefits of $80 million in fiscal 2021 (ending June 2021).
Rewards to Shareholders: It remains committed to rewarding shareholders through dividend payouts. In the first half of fiscal 2021, the company distributed dividends totaling 40 cents per share or $33.3 million to its shareholders.
Estimate Trend: In the past 30 days, analysts have increasingly become bullish on the company, as evident from positive earnings estimate revisions. The Zacks Consensus Estimate for its fiscal 2021 earnings has trended up from 73 cents to 75 cents on one upward estimate revision against none downward. In addition, over the same timeframe, the consensus estimate for fiscal 2022 (ending June 2022) earnings has trended up from $1.50 to $1.51 on one upward estimate revisions against none downward.
Other Stocks to Consider
Some other top-ranked stocks from the Industrial Products sector are Astec Industries, Inc. (ASTE - Free Report) , Acco Brands Corporation (ACCO - Free Report) and Kadant Inc. (KAI - Free Report) . While Astec currently sports a Zacks Rank #1 (Strong Buy), Acco Brands and Kadant carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Astec delivered a positive earnings surprise of 172.72%, on average, in the trailing four quarters.
Acco Brands delivered a positive earnings surprise of 278.70%, on average, in the trailing four quarters.
Kadant delivered a positive earnings surprise of 30.95%, on average, in the trailing four quarters.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>