Kennametal (NYSE:KMT) Stock Falls 13% - Time to Sell?

Key Points

• Kennametal shares fell about 13% to roughly $26.56, extending a decline below both its 50-day and 200-day moving averages.
• Analyst sentiment is cautious: five analysts rate the stock Hold and four Sell, with an average rating of “Reduce” and a consensus price target of $33.50.
• Quarterly results were mixed: EPS of $3.48 beat estimates of $2.65, while revenue of $768.2 million narrowly missed forecasts. Kennametal also declared a $0.20 quarterly dividend, equivalent to a 3.0% yield.

Kennametal Inc. (NYSE:KMT - Get Free Report) was down 13% during trading on Wednesday. The company traded as low as $27.17 and last traded at $26.5590. 257,613 shares changed hands during trading, a decline of 82% from the average session volume of 1,392,998 shares. The stock had previously closed at $30.53.

Wall Street Analyst Weigh In

Several research firms have recently issued reports on KMT. Zacks Research lowered shares of Kennametal from a "strong-buy" rating to a "hold" rating in a research report on Wednesday, October 14th. Weiss Ratings cut Kennametal from a "buy (b-)" rating to a "hold (c+)" rating in a report on Friday, October 23rd. Morgan Stanley lowered Kennametal from an "equal weight" rating to an "underweight" rating and reduced their target price for the company from $31.00 to $27.00 in a report on Monday, August 10th. UBS Group decreased their price target on Kennametal from $39.00 to $35.00 and set a "neutral" rating on the stock in a research report on Monday, August 10th. Finally, DA Davidson lowered their target price on shares of Kennametal from $34.00 to $30.00 and set a "neutral" rating on the stock in a research note on Tuesday, August 11th. Five research analysts have rated the stock with a Hold rating and four have assigned a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Reduce" and a consensus target price of $33.50.

Kennametal Stock Down 13.3%

The company has a quick ratio of 0.98, a current ratio of 2.62 and a debt-to-equity ratio of 0.42. The company's fifty day simple moving average is $30.44 and its 200 day simple moving average is $34.56. The firm has a market capitalization of $2.02 billion, a PE ratio of 6.02, a price-to-earnings-growth ratio of 0.30 and a beta of 1.30.

Kennametal (NYSE:KMT - Get Free Report) last announced its quarterly earnings data on Wednesday, November 4th. The industrial products company reported $3.48 EPS for the quarter, beating the consensus estimate of $2.65 by $0.83. Kennametal had a return on equity of 24.83% and a net margin of 14.53%. The business had revenue of $768.19 million during the quarter, compared to analyst estimates of $770.36 million. During the same quarter last year, the firm posted $0.34 earnings per share. The company's revenue for the quarter was up 54.3% on a year-over-year basis. Analysts anticipate that Kennametal Inc. will post 4.92 earnings per share for the current fiscal year.

Kennametal Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Monday, November 23rd. Stockholders of record on Monday, November 9th will be issued a dividend of $0.20 per share. The ex-dividend date is Monday, November 9th. This represents a $0.80 dividend on an annualized basis and a dividend yield of 3.0%. Kennametal's dividend payout ratio is presently 18.18%.

Insider Buying and Selling

In other Kennametal news, VP Judith Bacchus sold 9,676 shares of the stock in a transaction on Tuesday, September 8th. The stock was sold at an average price of $30.29, for a total transaction of $293,086.04. Following the sale, the vice president directly owned 15,721 shares in the company, valued at approximately $476,189.09. This trade represents a 38.10% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, CEO Sanjay Chowbey purchased 7,000 shares of the firm's stock in a transaction dated Thursday, September 10th. The stock was acquired at an average price of $29.10 per share, with a total value of $203,700.00. Following the purchase, the chief executive officer directly owned 246,839 shares of the company's stock, valued at approximately $7,183,014.90. The trade was a 2.92% increase in their ownership of the stock. The disclosure for this purchase is available in the SEC filing. 1.65% of the stock is owned by insiders.

Hedge Funds Weigh In On Kennametal

A number of institutional investors and hedge funds have recently made changes to their positions in the business. Fulcrum Asset Management LLP boosted its position in Kennametal by 3,904.0% during the 3rd quarter. Fulcrum Asset Management LLP now owns 6,006 shares of the industrial products company's stock valued at $186,000 after acquiring an additional 5,856 shares in the last quarter. M Holdings Securities Inc. acquired a new position in shares of Kennametal during the third quarter valued at about $214,000. Parallel Advisors LLC lifted its position in shares of Kennametal by 235.8% during the 3rd quarter. Parallel Advisors LLC now owns 5,581 shares of the industrial products company's stock valued at $172,000 after buying an additional 3,919 shares in the last quarter. Alps Advisors Inc. acquired a new position in Kennametal during the third quarter worth $4,656,000. Finally, Covestor Ltd raised its holdings in shares of Kennametal by 59.2% during the third quarter. Covestor Ltd now owns 3,060 shares of the industrial products company's stock valued at $94,000 after acquiring an additional 1,138 shares during the last quarter.

Kennametal Company Profile

Kennametal Inc NYSE: KMT is a global industrial technology company that develops and manufactures tooling, engineered components and wear-resistant solutions. Its products are designed to help customers improve productivity, durability and performance in demanding manufacturing and industrial applications.

The company's offerings include metal-cutting tools and systems, tooling components, advanced materials, and products made with hard metals and other wear-resistant technologies. Kennametal also provides engineered solutions for applications such as machining, earthworks, energy production, transportation, aerospace, defense and general engineering.

Founded in 1938 by Philip M.

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