Here's Why You Should Hold on to Kennametal (KMT) Stock Now
Kennametal Inc. KMT is benefiting from solid product offerings, commercial and operational excellence, and accretive pricing actions despite escalating costs and expenses, and forex woes.
What’s Aiding KMT?
Business Strength: KMT’s Metal Cutting segment is gaining from strength in its general engineering, transportation, aerospace and energy end markets. Also, its strategic initiatives, innovation and operational excellence bode well. The Infrastructure segment’s revenues are supported by strength in energy, earthworks and general engineering end markets and focus on improving customer service levels. The company’s accretive pricing actions are also supporting its growth.
Innovation Capabilities and Growth Initiatives: In the quarters ahead, Kennametal anticipates gaining from its innovation capabilities. Also, mega-trends like hybrid and electric vehicles, digitalization and ESG align well with the company’s technical expertise and market exposure. KMT also aims to drive improved profitability through operational excellence by enhancing manufacturing and business process productivity and optimizing investments in commercial excellence and technology to target the highest return growth initiatives.
Shareholder-Friendly Policies: Kennametal remains committed to rewarding its shareholders through dividend payments and share buybacks. In fiscal 2022 (ended June 2022) and in the first nine months of fiscal 2023 (ended March 2023), the company distributed dividends totaling $67 million and $48.5 million, respectively, to its shareholders. The company also bought back shares for $85 million in fiscal 2022 and $37.6 million in the first nine months of fiscal 2023.
In light of the above-mentioned positives, we believe, investors should retain KMT stock for now, as suggested by its current Zacks Rank #3 (Hold). Shares of the company have gained 15.8% in the year-to-date period.
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Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Alamo Group Inc. ALG currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks.
ALG delivered a trailing four-quarter earnings surprise of 17.7%, on average. In the past 60 days, estimates for Alamo’s 2023 earnings have increased 12.7%. The stock has increased 27.2% in the year-to-date period.
Axon Enterprise AXON sports a Zacks Rank of 1 at present. The company has a trailing four-quarter earnings surprise of 44.4%, on average.
In the past 60 days, estimates for Axon’s 2023 earnings have increased 12.6%. The stock has rallied 13.3% in the year-to-date period.
A. O. Smith Corporation AOS presently carries a Zacks Rank #2 (Buy). AOS’ earnings surprise in the last four quarters was 8%, on average.
In the past 60 days, estimates for A. O. Smith’s 2023 earnings have increased 0.6%. The stock has gained 23.4% in the year-to-date period.
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A. O. Smith Corporation (AOS) : Free Stock Analysis Report
Kennametal Inc. (KMT) : Free Stock Analysis Report
Alamo Group, Inc. (ALG) : Free Stock Analysis Report
Axon Enterprise, Inc (AXON) : Free Stock Analysis Report
