Metal cutting tools and materials manufacturer Kennametal (KMT) presents us with an exciting new value trade opportunity today after reporting fiscal second-quarter earnings. Despite lower guidance, the stock initially rallied before getting caught up in the malaise around small-cap stocks.

I think the initial rally is the real story here. PMI surveys released around the world last week suggest that industrial economics are bottoming out, which means that the future is what really matters to traders right now where companies like KMT are concerned. The past is over. And even the current quarter is now close to half over.

Buy KMT in the TRADING portfolio under $26 as I target $30. Earnings should improve 20% to $1.80 in the June 2025 fiscal year and as anticipation spreads, the stock should get moving back toward its July high.