NasdaqGS:LECO

Stock Analysis Report

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Executive Summary

Lincoln Electric Holdings, Inc., through its subsidiaries, designs, develops, manufactures, and sells welding, cutting, and brazing products worldwide. More Details


Snowflake Analysis

Established dividend payer with adequate balance sheet.


Similar Companies

Share Price & News

How has Lincoln Electric Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LECO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.2%

LECO

-6.4%

US Machinery

-3.3%

US Market


1 Year Return

3.2%

LECO

7.6%

US Machinery

10.9%

US Market

Return vs Industry: LECO underperformed the US Machinery industry which returned 7.6% over the past year.

Return vs Market: LECO underperformed the US Market which returned 10.9% over the past year.


Shareholder returns

LECOIndustryMarket
7 Day-3.2%-6.4%-3.3%
30 Day-8.8%-3.4%-5.7%
90 Day9.5%12.8%8.2%
1 Year5.1%3.2%9.8%7.6%13.4%10.9%
3 Year2.6%-3.2%17.1%9.6%34.9%25.9%
5 Year81.5%64.6%100.7%78.2%84.6%63.8%

Price Volatility Vs. Market

How volatile is Lincoln Electric Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lincoln Electric Holdings undervalued compared to its fair value and its price relative to the market?

24.54x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LECO ($88.75) is trading above our estimate of fair value ($82.74)

Significantly Below Fair Value: LECO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: LECO is poor value based on its PE Ratio (24.5x) compared to the US Machinery industry average (23.8x).

PE vs Market: LECO is poor value based on its PE Ratio (24.5x) compared to the US market (17.4x).


Price to Earnings Growth Ratio

PEG Ratio: LECO is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: LECO is overvalued based on its PB Ratio (8x) compared to the US Machinery industry average (2.1x).


Next Steps

Future Growth

How is Lincoln Electric Holdings forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

13.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LECO's forecast earnings growth (13.9% per year) is above the savings rate (2.2%).

Earnings vs Market: LECO's earnings (13.9% per year) are forecast to grow slower than the US market (23% per year).

High Growth Earnings: LECO's earnings are forecast to grow, but not significantly.

Revenue vs Market: LECO's revenue (6.2% per year) is forecast to grow slower than the US market (9.9% per year).

High Growth Revenue: LECO's revenue (6.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LECO's Return on Equity is forecast to be high in 3 years time (35.6%)


Next Steps

Past Performance

How has Lincoln Electric Holdings performed over the past 5 years?

13.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LECO has high quality earnings.

Growing Profit Margin: LECO's current net profit margins (7.9%) are lower than last year (10.4%).


Past Earnings Growth Analysis

Earnings Trend: LECO's earnings have grown by 13.3% per year over the past 5 years.

Accelerating Growth: LECO's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: LECO had negative earnings growth (-30.4%) over the past year, making it difficult to compare to the Machinery industry average (-12.7%).


Return on Equity

High ROE: Whilst LECO's Return on Equity (33.14%) is high, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Lincoln Electric Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: LECO's short term assets ($1.0B) exceed its short term liabilities ($568.6M).

Long Term Liabilities: LECO's short term assets ($1.0B) exceed its long term liabilities ($970.4M).


Debt to Equity History and Analysis

Debt Level: LECO's debt to equity ratio (116%) is considered high.

Reducing Debt: LECO's debt to equity ratio has increased from 18.2% to 116% over the past 5 years.

Debt Coverage: LECO's debt is well covered by operating cash flow (49.3%).

Interest Coverage: LECO's interest payments on its debt are well covered by EBIT (14.7x coverage).


Balance Sheet


Next Steps

Dividend

What is Lincoln Electric Holdings's current dividend yield, its reliability and sustainability?

2.21%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: LECO's dividend (2.21%) is higher than the bottom 25% of dividend payers in the US market (1.75%).

High Dividend: LECO's dividend (2.21%) is low compared to the top 25% of dividend payers in the US market (5.03%).


Stability and Growth of Payments

Stable Dividend: LECO's dividends per share have been stable in the past 10 years.

Growing Dividend: LECO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (53.6%), LECO's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LECO's dividends in 3 years are forecast to be well covered by earnings (37.3% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

6.1yrs

Average management tenure


CEO

Chris Mapes (58 yo)

7.75yrs

Tenure

US$6,981,969

Compensation

Mr. Christopher L. Mapes, also known as Chris, serves as the Chairman, Chief Executive Officer and President of Lincoln Electric Holdings, Inc. (formerly known as The Lincoln Electric Company). Mr. Mapes h ...


CEO Compensation Analysis

Compensation vs Market: Chris's total compensation ($USD6.98M) is about average for companies of similar size in the US market ($USD7.46M).

Compensation vs Earnings: Chris's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Christopher Mapes
Chairman7.75yrsUS$6.98m0.39%
$ 20.5m
Jennifer Ansberry
Executive VP3.42yrsUS$1.50m0.020%
$ 1.0m
Vincent Petrella
Executive Vice President0.42yrUS$2.67m0.12%
$ 6.6m
Steven Hedlund
Executive VP & President of International Welding5.67yrsUS$1.87m0.049%
$ 2.6m
Gabriel Bruno
Executive VP0.42yrno data0.039%
$ 2.0m
Amanda Butler
Vice President of Investor Relations & Communications7.5yrsno datano data
Michele Kuhrt
Executive VP & Chief Human Resources Officer1.58yrsno data0.020%
$ 1.1m
Michael Whitehead
Senior VP and President of Global Automation15yrsno data0.015%
$ 769.2k
David Nangle
Executive VP & President of Harris Products Group6.58yrsno data0.035%
$ 1.8m
Thomas Flohn
Senior VP & President of Asia Pacific Region – International Welding15.67yrsUS$1.27m0.051%
$ 2.7m
Michael Mintun
Senior Vice President of Sales & Marketing - North America6.58yrsno data0.022%
$ 1.2m
Douglas Lance
Senior VP & President of Cleveland Operations – Americas Welding4yrsno data0.018%
$ 932.6k

6.1yrs

Average Tenure

53yo

Average Age

Experienced Management: LECO's management team is seasoned and experienced (6.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Christopher Mapes
Chairman7.75yrsUS$6.98m0.39%
$ 20.5m
William MacDonald
Independent Director13.67yrsUS$227.92k0.028%
$ 1.5m
Stephen Hanks
Independent Director14.17yrsUS$232.92k0.037%
$ 2.0m
G. Lincoln
Independent Director31.67yrsUS$214.92k0.46%
$ 24.2m
Kathryn Lincoln
Independent Director25.67yrsUS$224.92k0.074%
$ 3.9m
Hellene Runtagh
Independent Director19.67yrsUS$214.92k0.042%
$ 2.2m
Curtis Espeland
Lead Independent Director2.42yrsUS$239.92k0.020%
$ 1.1m
Phillip Mason
Independent Director7.17yrsUS$224.92k0.024%
$ 1.3m
Michael Hilton
Independent Director5.17yrsUS$214.92k0.0089%
$ 471.6k
Benny Patel
Independent Director2.58yrsUS$214.92k0.0019%
$ 98.5k
Patrick Goris
Independent Director2.17yrsUS$214.92k0.00093%
$ 49.0k

7.2yrs

Average Tenure

66yo

Average Age

Experienced Board: LECO's board of directors are considered experienced (7.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: LECO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Lincoln Electric Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lincoln Electric Holdings, Inc.
  • Ticker: LECO
  • Exchange: NasdaqGS
  • Founded: 1895
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$5.269b
  • Shares outstanding: 59.37m
  • Website: https://www.lincolnelectric.com

Number of Employees


Location

  • Lincoln Electric Holdings, Inc.
  • 22801 St. Clair Avenue
  • Cleveland
  • Ohio
  • 44117
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LECONasdaqGS (Nasdaq Global Select)YesCommon SharesUSUSDJan 1975
LNEDB (Deutsche Boerse AG)YesCommon SharesDEEURJan 1975

Biography

Lincoln Electric Holdings, Inc., through its subsidiaries, designs, develops, manufactures, and sells welding, cutting, and brazing products worldwide. It operates through three segments: Americas Welding, ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/25 05:57
End of Day Share Price2020/09/24 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.