Kennametal (NYSE:KMT) shares jumped more than 12% in pre-market trading after the industrial technology company reported fourth-quarter results that comfortably exceeded Wall Street expectations and issued guidance well above analyst forecasts.
The company posted adjusted earnings of $2.96 per share, beating the consensus estimate of $2.32. Revenue reached $736.6 million, ahead of analyst expectations of $723.3 million.
Revenue growth accelerates
Quarterly revenue increased 43% from the same period last year, rising from $516.4 million, with 42% organic sales growth driving the improvement.
President and Chief Executive Officer Sanjay Chowbey said stronger market conditions and the company’s strategic initiatives supported the robust performance.
“Our team delivered strong fiscal 2026 results, reflecting volume from improving market conditions and our strategic growth initiatives,” Chowbey said. “We achieved record adjusted EPS this quarter through decisive pricing actions in an unprecedented tungsten environment, volume growth and cost improvement efforts.”
Guidance comes in well ahead of expectations
Kennametal issued first-quarter fiscal 2027 guidance that significantly exceeded Wall Street forecasts.
The company expects adjusted earnings per share of between $2.50 and $2.80, compared with the analyst consensus estimate of $1.62. The midpoint of the guidance, $2.65 per share, is approximately 64% above market expectations.
Revenue for the first quarter is forecast to range between $745 million and $775 million. The midpoint of $760 million compares favourably with the consensus estimate of $667.5 million.
Full-year forecast also raised
Management also introduced an optimistic outlook for fiscal 2027.
Kennametal expects full-year adjusted earnings per share of between $4.15 and $5.15, with the midpoint of $4.65 exceeding the analyst consensus forecast of $3.90.
The company projects annual revenue of between $3.33 billion and $3.45 billion. The midpoint of $3.39 billion is well above the market expectation of $2.34 billion.
Higher pricing and volumes boost profitability
Adjusted operating income for the fourth quarter increased to $305.7 million, representing an operating margin of 41.5%, compared with $38.2 million and a 7.4% margin in the same quarter last year.
The improvement was driven by favourable pricing linked to higher raw material costs, additional pricing and tariff surcharges within the Metal Cutting business, stronger sales volumes and approximately $5 million in restructuring savings.
For the full fiscal year 2026, Kennametal reported adjusted earnings of $4.57 per share, up from $1.34 in the previous financial year.
Kennametal stock price
