Is KAI a high-quality business?

AlphaMadera's AlphaQuality grade scores Kadant Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how KAI compares to a Buffett-style quality bar.

What is Kadant Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to KAI based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes KAI a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

KAI - Kadant Inc.

Price: -- -- | CONSENSUS: Hold DETAILS | PRICE TARGET: $303.00 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Platform & Compounding FCF

AlphaQuality — archetype-weighted quantitative grade

B- 66.8 / 100 composite

Composite Grade

Composite of six pillars weighted for platform & compounding fcf businesses. Purely quantitative — no stock price or analyst input.

Profitability

Weight: 25%

C- 48.2

5yr Avg ROIC 8.3% 52/100
Operating Margin Trend -0.25 pp/yr 40/100

Capital Efficiency

Weight: 15%

B- 62.2

5yr Avg ROE 10.8% 64/100
5yr Share-Count CAGR 0.3% 59/100

Growth Quality

Weight: 25%

B- 67.1

5yr Revenue CAGR 7.5% 73/100
5yr EPS CAGR 4.7% 52/100
Revenue-Growth Years (5) 4/5 80/100

Cash Generation

Weight: 20%

A- 86.5

5yr FCF Margin 13.7% 79/100
5yr FCF/NI Conversion 1.25x 96/100

Balance Sheet

Weight: 10%

A- 86.9

Net Debt / EBITDA 1.21x 82/100
Interest Coverage (EBIT/Int) 10.10x 85/100
Altman Z-Score 4.59 98/100

Stability

Weight: 5%

C 52.0

EPS Volatility (σ/μ) 0.47 34/100
Piotroski F-Score 5 56/100
Negative-Revenue Years (5) 1/5 80/100

2 of 2 gurus held; 1 added; 1 trimmed; 1 full exit.

Holders: 2
Avg Δ position: -33.7%
New buys: 0
Full exits: 1

Greenblatt sold -100%
Dalio decreased -74%
Cooperman increased +7%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (25%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (25%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (20%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (10%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (5%) — EPS Volatility (σ/μ), Piotroski F-Score, Negative-Revenue Years (5)

We deliberately ignore stock price, analyst targets, and consensus ratings so the grade is suitable for backtesting forward returns. A minimum of 5 fiscal years of audited statements is required; distressed and highly leveraged infrastructure businesses are declared ungradable rather than forced into a numeric score.