What To Expect From Kadant's (KAI) Q1 Earnings

Industrial equipment manufacturer Kadant (NYSE:KAI) will be reporting earnings tomorrow after market close. Here’s what to look for.

Kadant met analysts’ revenue expectations last quarter, reporting revenues of $258 million, up 8.1% year on year. It was a slower quarter for the company, with full-year EPS guidance missing analysts’ expectations.

Is Kadant a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Kadant’s revenue to decline 4.1% year on year to $238.8 million, a reversal from the 8.4% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.97 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Kadant has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 3.3% on average.

Looking at Kadant’s peers in the general industrial machinery segment, some have already reported their Q1 results, giving us a hint as to what we can expect. GE Aerospace posted flat year-on-year revenue, missing analysts’ expectations by 7.9%, and 3M reported a revenue decline of 1%, topping estimates by 4.6%. GE Aerospace traded up 8.6% following the results while 3M was also up 8%.

Read our full analysis of GE Aerospace’s results here and 3M’s results here.

Investors in the general industrial machinery segment have had fairly steady hands going into earnings, with share prices down 1.4% on average over the last month. Kadant is down 7.6% during the same time and is heading into earnings with an average analyst price target of $355 (compared to the current share price of $311.14).

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