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ESAB

ESAB NYSE:ESAB Stock Report

Last Price

US$44.04

Market Cap

US$2.6b

7D

-0.5%

1Y

n/a

Updated

17 Aug, 2022

Data

Company Financials +
ESAB fundamental analysis
Snowflake Score
Valuation5/6
Future Growth1/6
Past Performance1/6
Financial Health2/6
Dividends0/6

ESAB Stock Overview

ESAB Corporation formulates, develops, manufactures, and supplies consumable products and equipment for use in cutting, joining, and automated welding, as well as gas control equipment.

ESAB Competitors

Price History & Performance

Summary of all time highs, changes and price drops for ESAB
Historical stock prices
Current Share PriceUS$44.04
52 Week HighUS$58.08
52 Week LowUS$39.12
Beta0
1 Month Change8.55%
3 Month Change-5.88%
1 Year Changen/a
3 Year Changen/a
5 Year Changen/a
Change since IPO-11.92%

Recent News & Updates

Aug 09

ESAB Non-GAAP EPS of $1.14 beats by $0.13, revenue of $661.17M beats by $25.22M;reaffrirms FY guidance

ESAB press release (NYSE:ESAB): Q2 Non-GAAP EPS of $1.14 beats by $0.13. Revenue of $661.17M (+5.0% Y/Y) beats by $25.22M. The Company reported strong second quarter results, and reaffirmed its full year 2022 guidance, which excludes Russia from Q2 through the remainder of the year. ESAB continues to expect $2.45-$2.50 billion vs consensus of $2.50B  of sales with total reported sales growth of 2%-4%, full year adjusted EBITDA of $400-$420 million, adjusted EPS of $3.85-$4.05 vs consensus of $4.00 and free cash flow of greater than $210 million.

May 22

ESAB Corp.: Looks To Be A Solid Welding Play After The Spin-Off

ESAB is the welding business which has been spun off from its former parent, called Colfax. After cutting the 2022 guidance, I still find confidence in a solid strategy even after 2022 is set to be a rockier year, while spin-offs face inherent uncertainty. Amidst non-demanding valuations, I have taken a very small stake, acting as a watch function for now.

Shareholder Returns

ESABUS MachineryUS Market
7D-0.5%6.1%4.5%
1Yn/a-8.5%-8.9%

Return vs Industry: Insufficient data to determine how ESAB performed against the US Machinery industry.

Return vs Market: Insufficient data to determine how ESAB performed against the US Market.

Price Volatility

Is ESAB's price volatile compared to industry and market?
ESAB volatility
ESAB Average Weekly Movement5.7%
Machinery Industry Average Movement5.8%
Market Average Movement7.6%
10% most volatile stocks in US Market16.8%
10% least volatile stocks in US Market3.1%

Stable Share Price: ESAB is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: Insufficient data to determine ESAB's volatility change over the past year.

About the Company

FoundedEmployeesCEOWebsite
20219,275Shyam Kambeyanda

ESAB Corporation formulates, develops, manufactures, and supplies consumable products and equipment for use in cutting, joining, and automated welding, as well as gas control equipment. Its comprehensive range of welding consumables includes electrodes, cored and solid wires, and fluxes using a range of specialty and other materials; and cutting consumables, including electrodes, nozzles, shields, and tips. The company’s fabrication technology equipment ranges from portable welding machines to large customized automated cutting and welding systems.

ESAB Fundamentals Summary

How do ESAB's earnings and revenue compare to its market cap?
ESAB fundamental statistics
Market CapUS$2.64b
Earnings (TTM)US$213.91m
Revenue (TTM)US$2.54b

12.4x

P/E Ratio

1.0x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
ESAB income statement (TTM)
RevenueUS$2.54b
Cost of RevenueUS$1.67b
Gross ProfitUS$871.60m
Other ExpensesUS$657.69m
EarningsUS$213.91m

Last Reported Earnings

Jul 01, 2022

Next Earnings Date

n/a

Earnings per share (EPS)3.56
Gross Margin34.32%
Net Profit Margin8.42%
Debt/Equity Ratio92.3%

How did ESAB perform over the long term?

See historical performance and comparison

Dividends

0.5%

Current Dividend Yield

1%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is ESAB undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for ESAB?

Other financial metrics that can be useful for relative valuation.

ESAB key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue1.5x
Enterprise Value/EBITDA9.3x
PEG Ratio1.3x

Price to Earnings Ratio vs Peers

How does ESAB's PE Ratio compare to its peers?

ESAB PE Ratio vs Peers
The above table shows the PE ratio for ESAB vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average65.2x
SPXC SPX Technologies
56.7x47.4%US$2.9b
AIMC Altra Industrial Motion
148.5x62.4%US$2.8b
AIN Albany International
23.3x7.3%US$2.9b
ESE ESCO Technologies
32.3x17.5%US$2.3b
ESAB ESAB
12.4x9.6%US$2.6b

Price-To-Earnings vs Peers: ESAB is good value based on its Price-To-Earnings Ratio (12.4x) compared to the peer average (65.2x).


Price to Earnings Ratio vs Industry

How does ESAB's PE Ratio compare vs other companies in the US Machinery Industry?

Price-To-Earnings vs Industry: ESAB is good value based on its Price-To-Earnings Ratio (12.4x) compared to the US Machinery industry average (22.5x)


Price to Earnings Ratio vs Fair Ratio

What is ESAB's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

ESAB PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio12.4x
Fair PE Ration/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate ESAB's Price-To-Earnings Fair Ratio for valuation analysis.


Share Price vs Fair Value

What is the Fair Price of ESAB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: ESAB ($44.04) is trading below our estimate of fair value ($79.63)

Significantly Below Fair Value: ESAB is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.


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Future Growth

How is ESAB forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


9.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ESAB's forecast earnings growth (9.6% per year) is above the savings rate (1.9%).

Earnings vs Market: ESAB's earnings (9.6% per year) are forecast to grow slower than the US market (14.5% per year).

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

Revenue vs Market: ESAB's revenue (0.08% per year) is forecast to grow slower than the US market (7.9% per year).

High Growth Revenue: ESAB's revenue (0.08% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ESAB's Return on Equity is forecast to be high in 3 years time


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Past Performance

How has ESAB performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


9.1%

Last years earnings growth

Earnings and Revenue History

Quality Earnings: ESAB has high quality earnings.

Growing Profit Margin: ESAB's current net profit margins (8.4%) are lower than last year (9%).


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if ESAB's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Insufficient data to compare ESAB's past year earnings growth to its 5-year average.

Earnings vs Industry: ESAB earnings growth over the past year (9.1%) underperformed the Machinery industry 9.4%.


Return on Equity

High ROE: ESAB's Return on Equity (17%) is considered low.


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Financial Health

How is ESAB's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: ESAB's short term assets ($1.0B) exceed its short term liabilities ($642.1M).

Long Term Liabilities: ESAB's short term assets ($1.0B) do not cover its long term liabilities ($1.8B).


Debt to Equity History and Analysis

Debt Level: ESAB's net debt to equity ratio (88.1%) is considered high.

Reducing Debt: Insufficient data to determine if ESAB's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: ESAB's debt is not well covered by operating cash flow (14.5%).

Interest Coverage: ESAB earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet


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Dividend

What is ESAB current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


0.45%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: ESAB's dividend (0.45%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: ESAB's dividend (0.45%) is low compared to the top 25% of dividend payers in the US market (3.95%).


Stability and Growth of Payments

Stable Dividend: ESAB is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: ESAB is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Earnings Payout to Shareholders

Earnings Coverage: ESAB is not paying a notable dividend for the US market.


Cash Payout to Shareholders

Cash Flow Coverage: ESAB is not paying a notable dividend for the US market.


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Management

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

0.3yrs

Average board tenure


CEO

Shyam Kambeyanda (51 yo)

no data

Tenure

Mr. Shyam Kambeyanda serves as Chief Executive Officer at ESAB Corporation. He served as Chief Executive Officer and President of ESAB at Enovis Corporation (formerly known as Colfax Corporation) from May...


Board Members

Experienced Board: ESAB's board of directors are not considered experienced ( 0.3 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: ESAB insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: ESAB only recently listed within the past 12 months.


Top Shareholders

Company Information

ESAB Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: ESAB Corporation
  • Ticker: ESAB
  • Exchange: NYSE
  • Founded: 2021
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Implied Market Cap: US$2.644b
  • Shares outstanding: 60.04m

Number of Employees


Location

  • ESAB Corporation
  • 909 Rose Avenue
  • 8th Floor
  • North Bethesda
  • Maryland
  • 20852
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/17 00:00
End of Day Share Price2022/08/17 00:00
Earnings2022/07/01
Annual Earnings2021/12/31


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.