DB:KM3

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Executive Summary

Kennametal Inc. develops and applies tungsten carbides, ceramics, and super-hard materials and solutions for use in metal cutting and extreme wear applications to enable customers work against corrosion and high temperatures conditions worldwide.


Snowflake Analysis

Average dividend payer with moderate growth potential.


Similar Companies

Share Price & News

How has Kennametal's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: KM3 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

5.8%

KM3

2.3%

DE Machinery

2.2%

DE Market


1 Year Return

0.4%

KM3

7.8%

DE Machinery

12.4%

DE Market

Return vs Industry: KM3 underperformed the German Machinery industry which returned 7.8% over the past year.

Return vs Market: KM3 underperformed the German Market which returned 12.4% over the past year.


Shareholder returns

KM3IndustryMarket
7 Day5.8%2.3%2.2%
30 Day8.5%1.6%0.8%
90 Day25.5%24.9%18.1%
1 Year3.3%0.4%8.9%7.8%15.0%12.4%
3 Year-1.5%-8.2%-27.3%-31.5%8.5%-0.3%
5 Year12.0%-1.5%4.7%-5.9%27.8%10.6%

Price Volatility Vs. Market

How volatile is Kennametal's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Kennametal undervalued compared to its fair value and its price relative to the market?

2.09x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: KM3 (€25.6) is trading above our estimate of fair value (€15.9)

Significantly Below Fair Value: KM3 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: KM3 is unprofitable, so we can't compare its PE Ratio to the DE Machinery industry average.

PE vs Market: KM3 is unprofitable, so we can't compare its PE Ratio to the German market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate KM3's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: KM3 is overvalued based on its PB Ratio (2.1x) compared to the DE Machinery industry average (1.4x).


Next Steps

Future Growth

How is Kennametal forecast to perform in the next 1 to 3 years based on estimates from 12 analysts?

69.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KM3 is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (0.2%).

Earnings vs Market: KM3 is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: KM3's is expected to become profitable in the next 3 years.

Revenue vs Market: KM3's revenue (2.2% per year) is forecast to grow slower than the German market (5.9% per year).

High Growth Revenue: KM3's revenue (2.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: KM3's Return on Equity is forecast to be low in 3 years time (13.1%).


Next Steps

  • Explore growth companies in the Capital Goods industry.

Past Performance

How has Kennametal performed over the past 5 years?

60.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KM3 is currently unprofitable.

Growing Profit Margin: KM3 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: KM3 is unprofitable, but has reduced losses over the past 5 years at a rate of 60.7% per year.

Accelerating Growth: Unable to compare KM3's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: KM3 is unprofitable, making it difficult to compare its past year earnings growth to the Machinery industry (-38.8%).


Return on Equity

High ROE: KM3 has a negative Return on Equity (-0.4%), as it is currently unprofitable.


Next Steps

Financial Health

How is Kennametal's financial position?


Financial Position Analysis

Short Term Liabilities: KM3's short term assets ($1.4B) exceed its short term liabilities ($898.1M).

Long Term Liabilities: KM3's short term assets ($1.4B) exceed its long term liabilities ($870.7M).


Debt to Equity History and Analysis

Debt Level: KM3's debt to equity ratio (82.5%) is considered high.

Reducing Debt: KM3's debt to equity ratio has increased from 54.5% to 82.5% over the past 5 years.

Debt Coverage: KM3's debt is well covered by operating cash flow (27.6%).

Interest Coverage: KM3 is unprofitable, therefore interest payments are not well covered by earnings.


Balance Sheet


Next Steps

Dividend

What is Kennametal current dividend yield, its reliability and sustainability?

2.58%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: KM3's dividend (2.58%) is higher than the bottom 25% of dividend payers in the German market (1.23%).

High Dividend: KM3's dividend (2.58%) is low compared to the top 25% of dividend payers in the German market (3.74%).


Stability and Growth of Payments

Stable Dividend: KM3's dividends per share have been stable in the past 10 years.

Growing Dividend: KM3's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: KM3 is paying a dividend but the company is unprofitable.


Future Payout to Shareholders

Future Dividend Coverage: KM3's dividends in 3 years are forecast to be well covered by earnings (38.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.0yrs

Average management tenure


CEO

Chris Rossi (56 yo)

3yrs

Tenure

US$5,414,110

Compensation

Mr. Christopher Rossi, also known as Chris, has been Chief Executive Officer and President at Kennametal Inc. since August 1, 2017. Mr. Rossi served as the Chief Executive Officer of Dresser-Rand Group Inc ...


CEO Compensation Analysis

Compensation vs Market: Chris's total compensation ($USD5.41M) is above average for companies of similar size in the German market ($USD2.71M).

Compensation vs Earnings: Chris's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Christopher Rossi
President3yrsUS$5.41m0.10%
$ 2.2m
Damon Audia
VP & CFO1.92yrsUS$5.39m0.029%
$ 632.6k
Judith Bacchus
VP & Chief Administrative Officer1.25yrsUS$1.13m0.033%
$ 720.8k
Peter Dragich
Chief Operations Officer of Metal Cuttingno dataUS$2.15m0.053%
$ 1.2m
Ronald Port
VP & Chief Commercial Officer of Metal Cutting Business Segmentsno dataUS$1.47m0.021%
$ 449.0k
Carlonda Reilly
CTO & VP1.92yrsno data0.0031%
$ 68.2k
Thomas McKee
VP & Chief Information Officer 4yrsno datano data
Kelly Boyer
Vice President of Investor Relations4.58yrsno datano data
Michelle Keating
VP, Secretary & General Counsel3.67yrsUS$1.12m0.0099%
$ 215.4k
Franklin Cardenas
VP & President of Infrastructure Business Segment0.50yrno datano data
Patrick Watson
VP of Finance & Corporate Controller3.42yrsno data0.016%
$ 343.2k

3.0yrs

Average Tenure

52yo

Average Age

Experienced Management: KM3's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Christopher Rossi
President3yrsUS$5.41m0.10%
$ 2.2m
Steven Wunning
Independent Director15.08yrsUS$229.24k0.061%
$ 1.3m
William Lambert
Independent Director4.5yrsUS$217.72k0.012%
$ 267.5k
Lawrence Stranghoener
Independent Chairman of the Board & Lead Director2.08yrsUS$320.12k0.023%
$ 500.4k
Joseph Alvarado
Independent Director2.58yrsUS$210.12k0.0035%
$ 75.8k
Lorraine Martin
Independent Director2.08yrsUS$217.99k0.0085%
$ 185.0k
William Harvey
Independent Director9.42yrsUS$221.37k0.024%
$ 512.6k
Cynthia Davis
Independent Director7.75yrsUS$215.57k0.016%
$ 343.9k
Sagar Patel
Independent Director3.92yrsUS$210.12k0.0043%
$ 92.5k

3.9yrs

Average Tenure

62yo

Average Age

Experienced Board: KM3's board of directors are considered experienced (3.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: KM3 insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Kennametal Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Kennametal Inc.
  • Ticker: KM3
  • Exchange: DB
  • Founded: 1938
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$2.569b
  • Listing Market Cap: US$2.171b
  • Shares outstanding: 82.91m
  • Website: https://www.kennametal.com

Number of Employees


Location

  • Kennametal Inc.
  • 600 Grant Street
  • Suite 5100
  • Pittsburgh
  • Pennsylvania
  • 15219
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KMTNYSE (New York Stock Exchange)YesCapital StockUSUSDJan 1968
KM3DB (Deutsche Boerse AG)YesCapital StockDEEURJan 1968
KMT *BMV (Bolsa Mexicana de Valores)YesCapital StockMXMXNJan 1968

Biography

Kennametal Inc. develops and applies tungsten carbides, ceramics, and super-hard materials and solutions for use in metal cutting and extreme wear applications to enable customers work against corrosion an ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/08/15 03:48
End of Day Share Price2020/08/14 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.