Last week, you might have seen that Kennametal Inc. (NYSE:KMT) released its quarterly result to the market. The early response was not positive, with shares down 5.3% to US$22.15 in the past week. It was not a great result overall. While revenues of US$482m were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 11% to hit US$0.23 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Check out our latest analysis for Kennametal

Following the recent earnings report, the consensus from eight analysts covering Kennametal is for revenues of US$1.97b in 2025. This implies a noticeable 2.4% decline in revenue compared to the last 12 months. Statutory earnings per share are expected to decline 10% to US$1.12 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.03b and earnings per share (EPS) of US$1.43 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

The consensus price target fell 9.0% to US$24.13, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Kennametal analyst has a price target of US$30.00 per share, while the most pessimistic values it at US$19.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Kennametal shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Kennametal's past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.7% by the end of 2025. This indicates a significant reduction from annual growth of 1.6% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Kennametal is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Kennametal analysts - going out to 2027, and you can see them free on our platform here.

Before you take the next step you should know about the 1 warning sign for Kennametal that we have uncovered.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.