Industrial materials and tools company Kennametal (NYSE: KMT) will be announcing earnings results this Wednesday before market hours. Here’s what investors should know.
Kennametal beat analysts’ revenue expectations last quarter, reporting revenues of $592.6 million, up 21.8% year on year. It was a stunning quarter for the company, with an impressive beat of analysts’ organic revenue estimates and full-year EPS guidance exceeding analysts’ expectations.
Is Kennametal a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Kennametal’s revenue to grow 40.7% year on year, a reversal from the 4.9% decrease it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Kennametal has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Kennametal’s peers in the professional tools and equipment segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Stanley Black & Decker posted flat year-on-year revenue, meeting analysts’ expectations, and Hillman reported revenues up 9.8%, topping estimates by 1.3%. Stanley Black & Decker traded up 1.4% following the results.
Read our full analysis of Stanley Black & Decker’s results here and Hillman’s results here.
In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the professional tools and equipment stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 2% on average over the last month. Kennametal is up 2.3% during the same time and is heading into earnings with an average analyst price target of $34.86 (compared to the current share price of $35.01).
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