Kennametal (NYSE: KMT) Stock Downgraded Despite Robust Earnings Report

• Investment firm Morgan Stanley downgraded Kennametal (NYSE: KMT) from Equal-Weight to Underweight.
• The downgrade occurred despite Kennametal reporting strong financial results for its fourth quarter and full fiscal year 2026.
• Kennametal achieved significant organic sales growth and a substantial increase in adjusted earnings per share (EPS), driven by strategic initiatives and new business in key sectors.

Kennametal (NYSE: KMT), a leading company in industrial tools and advanced materials, is facing a new analyst rating. On August 10, 2026, investment firm Morgan Stanley downgraded Kennametal from Equal-Weight to Underweight. This significant rating change occurred when the stock price was $33.13 per share.

This downgrade comes just days after Kennametal announced strong financial results for its fourth quarter and full fiscal year 2026. The company reported significant earnings growth, creating a complex picture for investors when viewed against the new analyst rating from Morgan Stanley.

For the full fiscal year 2026, Kennametal saw its organic sales grow by 19% compared to the previous year. Its adjusted earnings per share (EPS) rose to $4.57 from $1.34. EPS is a key metric that shows how much profit a company makes for each share of its stock.

The company's fourth-quarter performance was even stronger, with organic sales increasing by 42%, as highlighted by MarketBeat. Kennametal also reported a record adjusted EBITDA margin of 46.8%. EBITDA measures a company's operating performance before accounting for non-operating expenses like interest and taxes.

As highlighted by PR Newswire, CEO Sanjay Chowbey credits this success to strategic pricing and growth in key sectors like aerospace and energy. Kennametal notes it is winning new business related to AI data centers and defense programs, expressing optimism for continued growth in fiscal 2027.