S&P upgrades Kennametal

S&P said it upgraded Kennametal Inc. to BBB from BBB-.

The outlook is stable.

At the same time, the agency raised the issue-level ratings on the company's senior unsecured debt to BBB from BBB-.

“The upgrade reflects a view that Kennametal's credit measures are likely to remain healthy, as the company has made substantial progress in reducing costs and improving pricing during a period in which its end-markets have recovered,” S&P said in a news release.

“Sales grew 15% during the company's fiscal year ended June 30, 2018 to $2.4 billion, with 12% of the growth coming organically.

“The pace of the organic growth has come down somewhat since its peak of 15% a couple of quarters ago, but we believe it will remain quite solid in fiscal 2019 in the mid to high single-digit area, as its end markets in general engineering, energy, transportation and aerospace all remain healthy.”

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