Kennametal (KMT) Shares Rise, Here’s the Reason
Kennametal Stock Surges After Analyst Upgrade
Kennametal (NYSE:KMT), a leading supplier of industrial tools and materials, saw its shares climb 8.6% during afternoon trading. This rally followed Jefferies' decision to upgrade the stock from Hold to Buy, along with a price target increase from $28 to $40. The upgrade was largely attributed to a dramatic rise in tungsten prices.
Tungsten prices have soared, jumping 190% compared to last year and up 47% since November. Jefferies analysts believe this surge will have a substantial positive impact on Kennametal’s short-term profits and operating margins. The optimistic forecast offers investors a potential upside as they await signs of recovery in short-cycle markets. This development builds on Kennametal’s recent momentum, as the company’s first-quarter fiscal 2026 results surpassed Wall Street’s predictions for both revenue and earnings.
Market Reaction and Recent Performance
Kennametal’s stock is typically stable, with only six instances in the past year where it moved more than 5% in a single session. Today’s significant jump signals that investors view the recent news as noteworthy, though it may not fundamentally alter the market’s long-term perspective on the company.
Just five days ago, Kennametal shares rose 2.9% as investors shifted away from technology stocks in anticipation of increased government spending. This sector-wide rally was sparked by President Trump’s proposal for a $1.5 trillion defense budget for 2027, which triggered sharp gains for defense contractors—Northrop Grumman surged over 10%, while Lockheed Martin advanced nearly 8%. The industrial sector also benefited from stabilizing energy prices, with crude oil rebounding. Together, these factors made industrial stocks more appealing to investors.
Since the start of the year, Kennametal’s stock has gained 14.6%, reaching a new 52-week high at $33.23 per share. However, a $1,000 investment in Kennametal five years ago would now be valued at $860.63.
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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