Kennametal (NYSE: KMT) and Welbilt (NYSE:WBT) are both mid-cap industrial products companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.
Risk & Volatility
Kennametal has a beta of 2.01, indicating that its share price is 101% more volatile than the S&P 500. Comparatively, Welbilt has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500.
This is a breakdown of recent ratings and recommmendations for Kennametal and Welbilt, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Kennametal currently has a consensus target price of $50.35, suggesting a potential upside of 24.14%. Welbilt has a consensus target price of $23.40, suggesting a potential upside of 20.93%. Given Kennametal’s higher possible upside, research analysts clearly believe Kennametal is more favorable than Welbilt.
Kennametal pays an annual dividend of $0.80 per share and has a dividend yield of 2.0%. Welbilt does not pay a dividend. Kennametal pays out 45.5% of its earnings in the form of a dividend.
Valuation and Earnings
This table compares Kennametal and Welbilt’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Kennametal||$2.06 billion||1.61||$49.13 million||$1.76||23.05|
|Welbilt||$1.45 billion||1.87||$134.00 million||$0.96||20.16|
Welbilt has lower revenue, but higher earnings than Kennametal. Welbilt is trading at a lower price-to-earnings ratio than Kennametal, indicating that it is currently the more affordable of the two stocks.
This table compares Kennametal and Welbilt’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
99.2% of Kennametal shares are owned by institutional investors. Comparatively, 89.9% of Welbilt shares are owned by institutional investors. 2.0% of Kennametal shares are owned by company insiders. Comparatively, 0.7% of Welbilt shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Kennametal beats Welbilt on 9 of the 16 factors compared between the two stocks.
Kennametal Company Profile
Kennametal Inc. is a supplier of tooling, engineered components and materials consumed in production processes. The Company operates through two segments: Industrial and Infrastructure. The Industrial segment generally serves customers that operate in industrial end markets, such as transportation, general engineering, aerospace and defense. The Infrastructure segment generally serves customers that operate in the earthworks and energy sectors supporting primary industries, such as oil and gas, power generation, underground, surface and hard-rock mining, highway construction and road maintenance. It provides wear-resistant products, application engineering and services backed by material science serving customers across various sectors. The Company’s product offerings include a selection of standard and customized technologies for metalworking, such as metal cutting tools, tooling systems and services, as well as materials, such as cemented tungsten carbide products and super alloys.
Welbilt Company Profile
Welbilt, Inc., formerly Manitowoc Foodservice, Inc., is a commercial foodservice equipment company. The Company designs, manufactures and supplies food and beverage equipment for the global commercial foodservice market, offering customers operator and patron insights, kitchen solutions, culinary expertise, and implementation support and service. It operates through three segments: Americas, EMEA and APAC. The Americas segment includes the United States, Canada and Latin America. The EMEA segment consists of markets in Europe, Middle East and Africa, including Russia and the commonwealth of independent states. The APAC segment consists of markets in China, Singapore, Australia, India, Malaysia, Indonesia, Thailand and the Philippines. It supplies foodservice equipment to commercial and institutional foodservice operators. Its brands include Cleveland, Convotherm, Delfield, fitKitchen, Frymaster, Garland, Kolpak, Lincoln, Manitowoc Ice, Merco, Merrychef and Multiplex.
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