NYSE:KAI

Stock Analysis Report

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Executive Summary

Kadant Inc. supplies equipment and critical components worldwide. More Details


Snowflake Analysis

Mediocre balance sheet with questionable track record.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: KAI is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: KAI's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

0.2%

KAI

2.2%

US Machinery

2.8%

US Market


1 Year Return

35.1%

KAI

19.4%

US Machinery

20.7%

US Market

Return vs Industry: KAI exceeded the US Machinery industry which returned 18.2% over the past year.

Return vs Market: KAI exceeded the US Market which returned 19.8% over the past year.


Shareholder returns

KAIIndustryMarket
7 Day0.2%2.2%2.8%
30 Day17.4%17.7%12.3%
90 Day11.9%15.2%6.4%
1 Year36.4%35.1%22.5%19.4%23.4%20.7%
3 Year33.4%29.6%32.6%23.1%47.2%37.4%
5 Year226.8%209.6%125.8%100.6%94.1%72.7%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

31.53x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: KAI ($131.56) is trading above our estimate of fair value ($131.06)

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


Price To Earnings Ratio

PE vs Industry: KAI is poor value based on its PE Ratio (31.5x) compared to the US Machinery industry average (29.8x).

PE vs Market: KAI is poor value based on its PE Ratio (31.5x) compared to the US market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: KAI is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: KAI is overvalued based on its PB Ratio (3.3x) compared to the US Machinery industry average (2.8x).


Next Steps

Future Growth

How is Kadant forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

17.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KAI's forecast earnings growth (17.9% per year) is above the savings rate (2.2%).

Earnings vs Market: KAI's earnings (17.9% per year) are forecast to grow slower than the US market (22% per year).

High Growth Earnings: KAI's earnings are forecast to grow, but not significantly.

Revenue vs Market: KAI's revenue (5.2% per year) is forecast to grow slower than the US market (10.2% per year).

High Growth Revenue: KAI's revenue (5.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: KAI's Return on Equity is forecast to be low in 3 years time (13.6%).


Next Steps

Past Performance

How has Kadant performed over the past 5 years?

13.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: KAI has high quality earnings.

Growing Profit Margin: KAI's current net profit margins (7.4%) are lower than last year (9%).


Past Earnings Growth Analysis

Earnings Trend: KAI's earnings have grown by 13.1% per year over the past 5 years.

Accelerating Growth: KAI's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: KAI had negative earnings growth (-22.7%) over the past year, making it difficult to compare to the Machinery industry average (-15.4%).


Return on Equity

High ROE: KAI's Return on Equity (10.4%) is considered low.


Next Steps

Financial Health

How is Kadant's financial position?


Financial Position Analysis

Short Term Liabilities: KAI's short term assets ($283.5M) exceed its short term liabilities ($127.9M).

Long Term Liabilities: KAI's short term assets ($283.5M) do not cover its long term liabilities ($323.8M).


Debt to Equity History and Analysis

Debt Level: KAI's debt to equity ratio (54.2%) is considered high.

Reducing Debt: KAI's debt to equity ratio has increased from 11.3% to 54.2% over the past 5 years.

Debt Coverage: KAI's debt is well covered by operating cash flow (36.7%).

Interest Coverage: KAI's interest payments on its debt are well covered by EBIT (9.9x coverage).


Balance Sheet


Next Steps

Dividend

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

0.73%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: KAI's dividend (0.73%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: KAI's dividend (0.73%) is low compared to the top 25% of dividend payers in the US market (4.05%).


Stability and Growth of Payments

Stable Dividend: KAI is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: KAI is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: KAI is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of KAI's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

3.5yrs

Average management tenure


CEO

Jeffrey Powell (61 yo)

1.33yrs

Tenure

US$2,765,943

Compensation

Mr. Jeffrey L. Powell serves as President at Kadant Inc. since April 1, 2019 and also its Chief Executive Officer & Director since July 1, 2019. Mr. Powell had been an Executive Vice President of Kadant In...


CEO Compensation Analysis

Compensation vs Market: Jeffrey's total compensation ($USD2.77M) is below average for companies of similar size in the US market ($USD4.16M).

Compensation vs Earnings: Jeffrey's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Jeffrey Powell
President1.33yrsUS$2.77m0.23%
$ 3.6m
Michael McKenney
Executive VP & CFO5.42yrsUS$1.30m0.16%
$ 2.5m
Eric Langevin
Executive VP & COO1.58yrsUS$1.42m0.45%
$ 6.9m
Stacy Krause
VP, General Counsel & Secretary2.33yrsUS$781.77k0.011%
$ 168.4k
Peter Flynn
Vice Presidentno dataUS$581.97k0.030%
$ 452.9k
Deborah Selwood
Senior VP & Chief Accounting Officer5.42yrsno data0.13%
$ 2.0m
Dara Mitchell
Senior Vice President of Corporate Development4.67yrsno datano data
Wesley Martz
Vice President of Marketing13.67yrsno datano data
Orrin Bean
Treasurer1.83yrsno datano data

3.5yrs

Average Tenure

57yo

Average Age

Experienced Management: KAI's management team is considered experienced (3.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Jeffrey Powell
President1.33yrsUS$2.77m0.23%
$ 3.6m
John Albertine
Independent Director19.42yrsUS$221.62k0.065%
$ 988.3k
Jonathan Painter
Chairman of the Board1.33yrsUS$2.54m0.18%
$ 2.8m
Erin Russell
Independent Director1.83yrsUS$214.12k0.030%
$ 450.2k
Thomas Leonard
Independent Director15.42yrsUS$224.12k0.091%
$ 1.4m
William Tully
Independent Director9.92yrsUS$224.12k0.038%
$ 571.3k

5.9yrs

Average Tenure

63yo

Average Age

Experienced Board: KAI's board of directors are considered experienced (5.9 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.1%.


Top Shareholders

Company Information

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


Key Information

  • Name: Kadant Inc.
  • Ticker: KAI
  • Exchange: NYSE
  • Founded: 1991
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$1.514b
  • Shares outstanding: 11.51m
  • Website: https://www.kadant.com

Number of Employees


Location

  • Kadant Inc.
  • One Technology Park Drive
  • Westford
  • Massachusetts
  • 1886
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
KAINYSE (New York Stock Exchange)YesCommon StockUSUSDNov 1992
KDADB (Deutsche Boerse AG)YesCommon StockDEEURNov 1992

Biography

Kadant Inc. supplies equipment and critical components worldwide. The company’s Papermaking Systems segment develops, manufactures, and markets custom-engineered stock-preparation systems and equipment for...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/27 23:33
End of Day Share Price2020/11/27 00:00
Earnings2020/09/26
Annual Earnings2019/12/28


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.