Kennametal Inc. (KMT): Today's Featured Industrial Goods Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Kennametal ( KMT) pushed the Industrial Goods sector lower today making it today's featured Industrial Goods laggard. The sector as a whole closed the day up 1%. By the end of trading, Kennametal fell 47 cents (-1.1%) to $42.09 on average volume. Throughout the day, 1.3 million shares of Kennametal exchanged hands as compared to its average daily volume of 886,500 shares. The stock ranged in price between $41.66-$42.66 after having opened the day at $42.31 as compared to the previous trading day's close of $42.56. Other companies within the Industrial Goods sector that declined today were: Sharps Compliance Corporation ( SMED), down 6.6%, India Globalization Capital ( IGC), down 6.1%, Intellicheck Mobilisa ( IDN), down 5.8%, and Ultralife Batteries ( ULBI), down 3.8%.
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Kennametal Inc. manufactures and supplies tooling, engineered components, and advanced materials consumed in production processes worldwide. Kennametal has a market cap of $3.39 billion and is part of the industrial industry. The company has a P/E ratio of 12.3, below the S&P 500 P/E ratio of 17.7. Shares are up 6.4% year to date as of the close of trading on Friday. Currently there are eight analysts that rate Kennametal a buy, no analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates Kennametal as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, Tecumseh Products Company ( TECUB), up 20.6%, Tecumseh Products Company ( TECUA), up 19.5%, Matrix Service Company ( MTRX), up 12.7%, and JinkoSolar ( JKS), up 12.2%, were all gainers within the industrial goods sector with Northrop Grumman ( NOC) being today's featured industrial goods sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the industrial goods sector could consider Industrial Select Sector SPDR ( XLI) while those bearish on the industrial goods sector could consider ProShares Short Dow 30 ( DOG).

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