Kadant (KAI) Stock Forecast & Price Target

Kadant Inc. has demonstrated a robust performance in its Material Handling segment, achieving record revenue driven by an 18% rise in capital shipments compared to the previous year, contributing to an overall revenue increase of 11% to $70.3 million. In Q3/25, new order activity rose by 5% to $94 million, supported by strong aftermarket and capital demand, while gross margins improved by 50 basis points to 45.2%, attributed to a significant increase in parts and consumable revenue, which represented 69% of total sales. The company's overall financial health is further highlighted by a notable 27% increase in adjusted EBITDA to $16.8 million, reinforcing a positive outlook for its continued growth.

Kadant Inc. has experienced a notable decline in its financial performance, with adjusted EBITDA dropping by 8% to $58 million and a flat year-over-year revenue of $272 million, influenced by a 4% decrease in organic revenue. The company has also witnessed a 10% decline in operating cash flow, falling to $47.3 million, and a 9% decrease in free cash flow, now at $44.1 million, further indicating operational challenges. Additionally, GAAP EPS decreased by 12% to $2.35, reflecting deteriorating profitability amidst a backdrop of declining bookings, which dropped 1% overall, and a concerning 4% decrease in organic bookings.