Morgan Stanley analyst Angel Castillo maintained a Hold rating on Kennametal (KMT – Research Report) yesterday and set a price target of $24.00.
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Angel Castillo’s rating is based on several financial adjustments and market considerations. The price target for Kennametal has been reduced from $28 to $24, with the valuation grounded on a 20 times multiple of the fiscal year 2025 earnings per share estimate. This adjustment reflects a perspective that the market is increasingly likely to discount earnings as they approach a potential low point.
Moreover, the revised earnings and EBITDA estimates indicate a downward trend due to factors such as lower organic revenue growth in key segments like Metal Cutting and Infrastructure, influenced by European and transportation market weaknesses. Although there is a partial offset from cost-saving measures leading to improved margins in the latter half of 2025, these adjustments are counterbalanced by negative foreign exchange impacts. Collectively, these considerations have led to the Hold rating.
Castillo covers the Industrials sector, focusing on stocks such as Agco, CNH Industrial, and Oshkosh. According to TipRanks, Castillo has an average return of 2.5% and a 65.85% success rate on recommended stocks.
In another report released on February 10, Loop Capital Markets also reiterated a Hold rating on the stock with a $21.00 price target.