Kennametal Outruns Estimates Again

Kennametal (NYSE: KMT  ) reported earnings on Jan. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q2), Kennametal met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue grew, and GAAP earnings per share increased significantly.

Margins expanded across the board.

Revenue details
Kennametal reported revenue of $641.7 million. The 12 analysts polled by S&P Capital IQ expected revenue of $638.7 million. Sales were 13% higher than the prior-year quarter's $565.8 million.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $0.91. The 13 earnings estimates compiled by S&P Capital IQ anticipated $0.78 per share on the same basis. GAAP EPS of $0.88 for Q2 were 75% higher than the prior-year quarter's $0.52 per share.

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Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 36.1%, 60 basis points better than the prior-year quarter. Operating margin was 14.7%, 290 basis points better than the prior-year quarter. Net margin was 11.5%, 380 basis points better than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $662.3 million. On the bottom line, the average EPS estimate is $0.93.

Next year's average estimate for revenue is $2.70 billion. The average EPS estimate is $3.79.

Inves! tor sent iment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 282 members out of 297 rating the stock outperform, and 15 members rating it underperform. Among 120 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 116 give Kennametal a green thumbs-up, and four 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 $46.83.

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