KMT Price Forecast Based on Dividend Discount Model

A technique commonly used by dividend investors to value dividend-issuing stocks is the Dividend Discount Model (DDM), which seeks to determine a fair share price based on the dividend provided by the company relative to a number of other company-specific factors. As for KMT, the dividend discount model StockNews created for the company implies a negative return of 37.24%. Digging deeper, the aspects of Kennametal Inc's dividend discount model that we found most interesting were:

• Kennametal Inc has annual revenue of approximately $2 billion; this classifies the stock in the mid-sized revenue class -- and relative to other dividend issuers in this class, the growth rate of its dividend is greater than that of merely 20.35% of them.
• A stock's beta generally indicates its volatility relative to the broader equity market; for Kennametal Inc, its beta is lower than merely 14.58% of dividend issuing stocks we observed.
• As other dividend issuers in the Industrials sector, Kennametal Inc has an equity discount rate lower than merely 12.7% of them.

KMT Dividends vs. Peers