📊 KMT Key Takeaways
Is Kennametal Inc. (KMT) a Good Investment?
Kennametal exhibits deteriorating fundamentals with declining revenue (-3.9% YoY) and net income (-5.7% YoY), compounded by critically weak free cash flow generation (1.0% FCF margin). While solid liquidity (2.38x current ratio) and manageable leverage (0.44x D/E) provide a financial cushion, persistently low returns on equity (8.5%) and assets (4.2%) indicate capital inefficiency in a cyclical industry facing structural headwinds.
Kennametal’s fundamentals show resilient margins and solid liquidity with moderate leverage, but revenue and earnings are declining and returns on capital are modest. Free cash flow is positive yet thin, leaving less cushion if industrial demand softens. Near‑term improvement depends on stabilizing volume and expanding operating margin to lift cash conversion.
Why Buy Kennametal Inc. Stock? KMT Key Strengths
- Strong current ratio of 2.38x provides substantial liquidity cushion and financial flexibility
- Moderate leverage with 0.44x debt-to-equity ratio and robust 8.4x interest coverage ratio
- Maintained profitability with $115.4M net income despite challenging operating environment
- Healthy liquidity (current 2.55x, quick 1.14x)
- Moderate leverage (0.45x D/E) with adequate 4.5x interest coverage
- Positive FCF and solid 32% gross margin
KMT Stock Risks: Kennametal Inc. Investment Risks
- Revenue declining -3.9% YoY with net income declining faster at -5.7% YoY, signaling demand weakness and margin compression
- Critically weak free cash flow of only $16.0M (1.0% FCF margin) indicates capital-intensive operations struggling to convert profits into cash
- EPS declining at -12.4% YoY, faster than net income decline, suggesting share dilution or unfavorable capital allocation
- Declining revenue and EPS indicate cyclical demand pressure
- Low ROE (4.3%) and ROA (2.2%) signal weak capital efficiency
- Thin FCF margin (3.6%) limits shock absorption if earnings slip
Key Metrics to Watch
- Free cash flow margin and operating cash flow trend - must show improvement from current 1.0% FCF margin to validate business sustainability
- Revenue growth stabilization - need to reverse -3.9% YoY decline and demonstrate market recovery
- Return on equity trajectory - current 8.5% ROE is suboptimal and should improve to validate capital deployment efficiency
- YoY revenue growth
- Free cash flow margin
Kennametal Inc. (KMT) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 1.0% FCF margin may limit capital allocation flexibility. Strong liquidity with a 2.38x current ratio provides a solid financial cushion.
KMT Profit Margin, ROE & Profitability Analysis
KMT vs Materials Sector: How Kennametal Inc. Compares
How Kennametal Inc. compares to Materials sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Kennametal Inc. Stock Overvalued? KMT Valuation Analysis 2026
Based on fundamental analysis, Kennametal Inc. has mixed fundamental signals relative to the Materials sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Kennametal Inc. Balance Sheet: KMT Debt, Cash & Liquidity
KMT Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Kennametal Inc.'s revenue has declined by 13% over the 5-year period, indicating business contraction. The most recent EPS of $1.46 reflects profitable operations.
KMT Revenue Growth, EPS Growth & YoY Performance
KMT Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2026 | $486.4M | $31.5M | $0.41 |
| Q2 2026 | $482.1M | $17.9M | $0.23 |
| Q1 2026 | $481.9M | $22.1M | $0.28 |
| Q3 2025 | $486.4M | $19.0M | $0.24 |
| Q2 2025 | $482.1M | $17.9M | $0.23 |
| Q1 2025 | $481.9M | $22.1M | $0.28 |
| Q3 2024 | $515.8M | $19.0M | $0.24 |
| Q2 2024 | $495.3M | $21.9M | $0.27 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Kennametal Inc. Dividends, Buybacks & Capital Allocation
KMT SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Kennametal Inc. (CIK: 0000055242)
📋 Recent SEC Filings
❓ Frequently Asked Questions about KMT
What is the AI rating for KMT?
Kennametal Inc. (KMT) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 70% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are KMT's key strengths?
Claude: Strong current ratio of 2.38x provides substantial liquidity cushion and financial flexibility. Moderate leverage with 0.44x debt-to-equity ratio and robust 8.4x interest coverage ratio. ChatGPT: Healthy liquidity (current 2.55x, quick 1.14x). Moderate leverage (0.45x D/E) with adequate 4.5x interest coverage.
What are the risks of investing in KMT?
Claude: Revenue declining -3.9% YoY with net income declining faster at -5.7% YoY, signaling demand weakness and margin compression. Critically weak free cash flow of only $16.0M (1.0% FCF margin) indicates capital-intensive operations struggling to convert profits into cash. ChatGPT: Declining revenue and EPS indicate cyclical demand pressure. Low ROE (4.3%) and ROA (2.2%) signal weak capital efficiency.
What is KMT's revenue and growth?
Kennametal Inc. reported revenue of $1.6B.
Does KMT pay dividends?
Kennametal Inc. pays dividends, with $45.6M distributed to shareholders in the trailing twelve months.
Where can I find KMT SEC filings?
Official SEC filings for Kennametal Inc. (CIK: 0000055242) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is KMT's EPS?
Kennametal Inc. has a diluted EPS of $1.49.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is KMT a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Kennametal Inc. has a HOLD rating with 70% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is KMT stock overvalued or undervalued?
Valuation metrics for KMT: ROE of 8.5% (sector avg: 14%), net margin of 7.1% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy KMT stock in 2026?
Our dual AI analysis gives Kennametal Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is KMT's free cash flow?
Kennametal Inc.'s operating cash flow is $69.7M, with capital expenditures of $53.7M. FCF margin is 1.0%.
How does KMT compare to other Materials stocks?
Vs Materials sector averages: Net margin 7.1% (avg: 10%), ROE 8.5% (avg: 14%), current ratio 2.38 (avg: 1.6).