The 10-second takeaway
For the quarter ended Sep. 30 (Q1), Kennametal missed estimates on revenues and whiffed on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share dropped significantly.
Margins contracted across the board.
Kennametal booked revenue of $629.5 million. The 13 analysts polled by S&P Capital IQ expected sales of $690.1 million on the same basis. GAAP reported sales were 4.5% lower than the prior-year quarter's $658.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.56. The 14 earnings estimates compiled by S&P Capital IQ averaged $0.88 per share. GAAP EPS of $0.57 for Q1 were 35% lower than the prior-year quarter's $0.88 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 33.1%, 500 basis points worse than the prior-year quarter. Operating margin was 10.2%, 520 basis points worse than the prior-year quarter. Net margin was 7.4%, 350 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $687.8 million. On the bottom line, the average EPS estimate is $0.85.
Next year's average estimate for revenue is $2.91 billion. The average EPS estimate is $3.94.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 316 members out of 328 rating the stock outperform, and 12 members rating it underperform. Among 103 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 102 give Kennametal a green thumbs-up, and one give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Kennametal is outperform, with an average price target of $44.08.
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