Kadant (KAI) AI Stock Analysis

• Market Cap: $3.72B
• Dividend Yield: 0.46%
• Average Volume (3M): 145.77K
• Price to Earnings (P/E): 36.5
• Beta (1Y): 1.33
• Revenue Growth: -0.96%
• EPS Growth: -11.55%
• Country: US
• Employees: 3,500
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 2.59
• Shares Outstanding: 11,778,135
• 10 Day Avg. Volume: 195,513
• 30 Day Avg. Volume: 145,769
• PEG Ratio: -8.93
• Price to Book (P/B): 4.86
• Price to Sales (P/S): 3.91
• P/FCF Ratio: 30.67
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 3.61
• Enterprise Value/Gross Profit: 8.00
• Enterprise Value/Ebitda: 16.78
• 1Y Price Target: $360.00
• Price Target Upside: 14.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: $340.00 ▲(7.77% Upside)

Kadant's overall stock score reflects strong financial stability and positive corporate events, which are offset by valuation concerns and mixed technical indicators. The company's strategic acquisitions and credit facility expansion provide a positive outlook, but challenges in revenue growth and market conditions temper the overall score.

Positive Factors

Aftermarket Parts Revenue Growth

The growth in aftermarket parts revenue indicates strong demand for Kadant's products and services, providing a stable income stream and supporting long-term profitability.

Acquisition of Clyde Industries

This acquisition strengthens Kadant's market position in the Industrial Processing segment, enhancing its product offerings and supporting long-term growth strategies.

Credit Facility Expansion

Expanding the credit facility enhances Kadant's financial flexibility, supporting strategic initiatives and operational needs, which is crucial for sustained growth.

Negative Factors

Revenue Decline in Key Segments

Declining revenue in key segments like Industrial Processing suggests challenges in maintaining sales momentum, potentially impacting future growth.

Increased SG&A Expenses

Rising SG&A expenses as a percentage of revenue can pressure margins, reducing profitability and limiting resources for growth initiatives.

Weakness in Capital Project Orders

Flat bookings in capital project orders reflect broader economic challenges, potentially affecting future revenue and growth prospects.

Kadant Business Overview & Revenue Model

Company Description

Kadant Inc. supplies technologies and engineered systems worldwide. It operates through three segments: Flow Control, Industrial Processing, and Material Handling. The Flow Control segment develops, manufactures, and markets fluid-handling systems and equipment, such as rotary joints, syphons, turbulator bars, expansion joints, and engineered steam and condensate systems; and doctoring, cleaning, and filtration systems and related consumables, consisting of doctor systems and holders, doctor blades, shower and fabric-conditioning systems, formation systems, and water-filtration systems. The Industrial Processing segment develops, manufactures, and markets ring and rotary debarkers, stranders, chippers, logging machinery, industrial automation and control systems, recycling and approach flow systems, and virgin pulping process equipment for use in the packaging, tissue, wood products, and alternative fuel industries. The Material Handling segment offers conveying and vibratory equipment, and balers and related equipment; and manufactures and sells biodegradable absorbent granules for carriers in as carriers in agricultural, home lawn and garden, professional lawn, turf, and ornamental applications, as well as for oil and grease absorption. The company was formerly known as Thermo Fibertek Inc. and changed its name to Kadant Inc. in July 2001. Kadant Inc. was incorporated in 1991 and is headquartered in Westford, Massachusetts.

How the Company Makes Money

Kadant generates revenue primarily through the sale of its equipment and systems, as well as through ongoing service and support contracts. Key revenue streams include the initial sale of products, which is complemented by aftermarket sales of replacement parts and maintenance services. Additionally, the company benefits from long-term contracts with customers in the papermaking and wood processing industries, which provide a steady stream of income. Kadant also engages in strategic partnerships and collaborations with other industry players to enhance its product offerings and expand its market reach, contributing to its overall earnings.

Kadant Financial Statement Overview

Summary

Kadant demonstrates strong profitability and a solid balance sheet with low leverage, which provides financial stability. However, the decline in revenue growth and free cash flow growth in the TTM period suggests potential challenges in sustaining growth. Continued focus on revenue generation and cash flow management will be crucial for maintaining financial health.

Income Statement

Kadant's income statement shows stable profitability with a gross profit margin of 45.1% and a net profit margin of 9.96% in the TTM period. However, revenue growth has slightly declined by 0.5% in the TTM, indicating potential challenges in maintaining sales momentum. The EBIT and EBITDA margins remain healthy at 16.66% and 21.50%, respectively, reflecting efficient cost management.

Balance Sheet

The balance sheet reflects a solid equity position with a debt-to-equity ratio of 0.27, indicating low leverage. Return on equity is reasonable at 11.69%, suggesting effective use of equity capital. The equity ratio stands at 61.98%, demonstrating a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by 282.1% in the TTM, which could be a concern. However, the operating cash flow to net income ratio of 0.76 and free cash flow to net income ratio of 0.90 indicate that the company is generating sufficient cash relative to its net income, supporting operational needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.02B	1.05B	957.67M	904.74M	786.58M	635.03M
Gross Profit	461.89M	466.15M	416.31M	389.56M	337.37M	277.31M
EBITDA	220.18M	222.69M	200.71M	207.05M	151.18M	112.11M
Net Income	101.98M	111.60M	116.07M	120.93M	84.04M	55.20M
Balance Sheet
Total Assets	1.53B	1.43B	1.18B	1.15B	1.13B	927.57M
Cash, Cash Equivalents and Short-Term Investments	126.91M	94.66M	106.45M	79.72M	94.16M	66.64M
Total Debt	258.00M	322.84M	135.61M	223.44M	294.07M	260.07M
Total Liabilities	570.73M	572.22M	399.43M	494.31M	566.60M	430.67M
Stockholders Equity	949.85M	847.13M	773.70M	653.85M	563.94M	495.36M
Cash Flow
Free Cash Flow	145.89M	134.26M	133.69M	74.43M	149.65M	85.29M
Operating Cash Flow	162.46M	155.26M	165.54M	102.63M	162.42M	92.88M
Investing Cash Flow	-29.49M	-319.14M	-30.79M	-29.52M	-154.47M	-14.54M
Financing Cash Flow	-96.16M	159.91M	-111.11M	-80.57M	22.81M	-84.56M

Kadant Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 315.48
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KAI, the sentiment is Positive. The current price of 315.48 is above the 20-day moving average (MA) of 297.76, above the 50-day MA of 283.06, and above the 200-day MA of 307.08, indicating a bullish trend. The MACD of 7.62 indicates Negative momentum. The RSI at 63.58 is Neutral, neither overbought nor oversold. The STOCH value of 80.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KAI.

Kadant Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MWA	77 Outperform	$4.03B	21.18	21.40%	1.09%	8.75%	64.82%
CSW	76 Outperform	$5.36B	37.73	13.29%	0.26%	14.87%	15.63%
THR	75 Outperform	$1.33B	23.62	11.74%	―	3.08%	35.81%
CXT	72 Outperform	$2.92B	19.02	13.54%	1.42%	9.30%	-12.55%
FELE	71 Outperform	$4.41B	32.39	10.89%	1.06%	5.06%	-22.73%
KAI	68 Neutral	$3.72B	36.48	11.32%	0.46%	-0.96%	-11.55%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Kadant Corporate Events

Kadant Reports Q3 2025 Financial Results

Kadant Inc. reported its financial results for the third quarter of 2025, showing stable revenue of $272 million but a decline in net income by 12% to $28 million. Despite challenges such as reduced demand for capital equipment and global trade uncertainties, the company achieved a solid gross margin of 45.2%, driven by strong performance in its aftermarket parts business. The company anticipates improved demand for its products in the fourth quarter, with revised revenue expectations for 2025 between $1.036 to $1.046 billion.

The most recent analyst rating on (KAI) stock is a Hold with a $319.00 price target. To see the full list of analyst forecasts on Kadant stock, see the KAI Stock Forecast page.