New York, Feb 4, 2026, 15:51 (EST) — Regular session
- KMT shares jumped roughly 7.5% in afternoon trading following Kennametal’s upgrade to its full-year outlook
- The toolmaker cited customer “buy-ahead” linked to tungsten prices alongside slight gains in end-market demand
- Traders are closely eyeing if the pull-forward will sustain into the next quarter and its impact on cash flow
Kennametal shares surged Wednesday following an upward revision of its full-year forecast. The cutting-tools maker cited a quarterly beat, boosted by customers rushing to buy before price adjustments related to tungsten. The stock climbed $2.67 to $38.43 in afternoon trading.
This matters because Kennametal operates near the factory floor. Investors want clearer evidence that short-cycle industrial demand is holding steady, not just fluctuating from one quarter to the next.
There’s a catch behind the quarter’s strong numbers. Management noted that some customers “bought ahead,” placing orders early to avoid rising prices. That boosts sales for now but risks a slowdown down the line.
Kennametal reported a 10% jump in second-quarter sales to $530 million, with earnings per share hitting 44 cents. Adjusted EPS, excluding special items, came in at 47 cents. The company raised its fiscal 2026 outlook, projecting adjusted EPS between $2.05 and $2.45 on sales ranging from $2.19 billion to $2.25 billion. For the third quarter, it expects adjusted EPS of 50 to 60 cents and sales between $545 million and $565 million. CEO Sanjay Chowbey noted volumes were boosted by “buy-ahead” activity linked to tungsten pricing. Year-to-date free operating cash flow slipped to $38 million from $57 million. The board also declared a $0.20 quarterly dividend, payable Feb. 24 to shareholders of record Feb. 10. PR Newswire
Margins also saw a boost. Operating income jumped 66% to $53 million, with adjusted operating income up 68% to $56 million. Kennametal pointed to pricing moves, tariff surcharges (extra fees to cover import taxes), and restructuring savings as key drivers, alongside a favorable spread between pricing and raw material expenses.
According to TheFly, analysts were looking for adjusted EPS of 38 cents on roughly $522.9 million in revenue.
On Wednesday, Kennametal filed an 8-K with the SEC, including its full earnings release as an exhibit.
The broader backdrop has shifted slightly. The Institute for Supply Management reported its Manufacturing PMI climbed to 52.6 in January — marking the first expansion in a year — driven by a surge in new orders.
Kennametal stood out as the broader market faltered: the S&P 500 ETF slipped roughly 0.2%, and the Nasdaq-tracking QQQ dropped around 1.4% in late afternoon trading.
But the buy-ahead effect works both ways. Once customers have stocked up, volumes can slow down as tungsten prices shift and tariff-related expenses filter through. The company has also pointed out that working capital — particularly inventory — has weighed on cash flow.
Kennametal produces metal-cutting tools and wear-resistant components for aerospace, defense, earthworks, energy, and several other sectors. The company runs two main segments: Metal Cutting and Infrastructure, with a strong dependence on tungsten carbides and other durable materials.
