Kadant (NYSE:KAI) Announces Quarterly Earnings Results, Beats Estimates By $0.37 EPS

Key Points

• Kadant reported Q2 earnings of $2.31 per share, exceeding the consensus estimate of $1.94 by $0.37, with a return on equity of 13.74% and a net margin of 10.63%.
• The company initiated a $50 million share repurchase plan, indicating that the board believes its shares are undervalued.
• Kadant declared a quarterly dividend of $0.34 per share, reflecting an annualized yield of 0.39%.

Kadant (NYSE:KAI - Get Free Report) released its quarterly earnings results on Tuesday. The industrial products company reported $2.31 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.94 by $0.37, Zacks reports. The business had revenue of $255.27 million during the quarter, compared to the consensus estimate of $245.99 million. Kadant had a return on equity of 12.62% and a net margin of 10.34%. The business's revenue was down 7.3% on a year-over-year basis. During the same quarter in the previous year, the company posted $2.81 EPS. Kadant updated its Q3 2025 guidance to 2.130-2.230 EPS and its FY 2025 guidance to 9.050-9.250 EPS.

Kadant Trading Down 2.8%

Shares of NYSE KAI traded down $9.34 during midday trading on Friday, hitting $323.43. The stock had a trading volume of 56,158 shares, compared to its average volume of 147,863. The company has a market capitalization of $3.81 billion, a price-to-earnings ratio of 35.98 and a beta of 1.25. Kadant has a 1-year low of $281.30 and a 1-year high of $429.95. The company has a quick ratio of 1.62, a current ratio of 8.17 and a debt-to-equity ratio of 0.27. The company has a fifty day moving average price of $323.88 and a 200 day moving average price of $336.14.

Kadant Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, August 7th. Stockholders of record on Thursday, July 10th will be paid a $0.34 dividend. This represents a $1.36 annualized dividend and a dividend yield of 0.4%. The ex-dividend date of this dividend is Thursday, July 10th. Kadant's payout ratio is currently 15.14%.

Kadant declared that its board has authorized a stock repurchase plan on Thursday, May 15th that permits the company to repurchase $50.00 million in outstanding shares. This repurchase authorization permits the industrial products company to repurchase up to 1.3% of its shares through open market purchases. Shares repurchase plans are often a sign that the company's board of directors believes its stock is undervalued.

Hedge Funds Weigh In On Kadant

Hedge funds and other institutional investors have recently modified their holdings of the company. United Services Automobile Association acquired a new position in shares of Kadant in the 1st quarter valued at about $255,000. Integrated Wealth Concepts LLC lifted its stake in shares of Kadant by 8.6% in the 1st quarter. Integrated Wealth Concepts LLC now owns 907 shares of the industrial products company's stock valued at $306,000 after purchasing an additional 72 shares in the last quarter. AQR Capital Management LLC lifted its stake in shares of Kadant by 11.2% in the 1st quarter. AQR Capital Management LLC now owns 2,763 shares of the industrial products company's stock valued at $931,000 after purchasing an additional 279 shares in the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. lifted its stake in shares of Kadant by 4.7% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 6,985 shares of the industrial products company's stock valued at $2,353,000 after purchasing an additional 311 shares in the last quarter. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC lifted its position in Kadant by 1.4% during the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 30,974 shares of the industrial products company's stock worth $10,435,000 after acquiring an additional 441 shares in the last quarter. 96.13% of the stock is owned by institutional investors and hedge funds.

Wall Street Analyst Weigh In

A number of analysts recently commented on the company. Wall Street Zen upgraded Kadant from a "sell" rating to a "hold" rating in a research report on Saturday, July 5th. Barrington Research restated an "outperform" rating and issued a $380.00 price target on shares of Kadant in a report on Tuesday. Finally, DA Davidson lowered their price target on Kadant from $300.00 to $275.00 and set a "neutral" rating for the company in a report on Thursday, May 1st.

About Kadant

Kadant Inc supplies technologies and engineered systems worldwide. It operates in three segments: Flow Control, Industrial Processing, and Material Handling. The Flow Control segment develops, manufactures, and markets fluid-handling systems and equipment, such as rotary joints, syphons, turbulator bars, expansion joints, and engineered steam and condensate systems; and doctoring, cleaning, and filtration systems and related consumables consisting of doctor systems and holders, doctor blades, cleaning shower and fabric-conditioning systems, forming systems and wear surfaces, and water-filtration systems.