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1. Company Snapshot

1.a. Company Description

Lincoln Electric Holdings, Inc., through its subsidiaries, designs, develops, manufactures, and sells welding, cutting, and brazing products worldwide.The company operates through three segments: Americas Welding, International Welding, and The Harris Products Group.It offers welding products, including arc welding power sources, plasma cutters, wire feeding systems, robotic welding packages, integrated automation systems, fume extraction equipment, consumable electrodes, fluxes and welding accessories, and specialty welding consumables and fabrication products.


The company's product offering also includes computer numeric controlled plasma and oxy-fuel cutting systems, and regulators and torches used in oxy-fuel welding, cutting, and brazing; and consumables used in the brazing and soldering alloys market.In addition, it is involved in the retail business in the United States.Further, the company manufactures copper and aluminum headers, distributor assemblies, and manifolds for the heating, ventilation, and air conditioning sector in the United States and Mexico.


The company serves general fabrication, energy and process, automotive and transportation, and construction and infrastructure industries, as well as heavy fabrication, ship building, and maintenance and repair markets.It sells its products directly to users of welding products, as well as through industrial distributors, retailers, and agents.The company was founded in 1895 and is headquartered in Cleveland, Ohio.

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1.b. Last Insights on LECO

Lincoln Electric Holdings' recent performance was driven by a strong Q4 2025 earnings beat, with adjusted EPS of $2.65 surpassing estimates of $2.53. The company's revenue of $1.0944 billion also exceeded expectations. Additionally, institutional investors such as Universal Beteiligungs und Servicegesellschaft mbH, Allianz Asset Management GmbH, and Hillsdale Investment Management Inc. increased their holdings in the company, indicating confidence in its prospects. Furthermore, the company's Board of Directors declared a quarterly cash dividend of $0.79 per common share, providing a return to shareholders.

1.c. Company Highlights

2. Lincoln Electric's Strong 2025 Results and Ambitious 2030 Targets

Lincoln Electric reported a record $4.2 billion in sales for 2025, a 6% increase driven by acquisitions and price actions. The company maintained its adjusted operating income margin and achieved a record adjusted EPS of $9.87. In the fourth quarter, organic sales grew 2.5% from price, largely offset by weaker volume performance. Adjusted operating income increased 4% to $194 million, and adjusted operating income margin declined 20 basis points to 18%. Actual EPS for the quarter came in at $2.65, beating estimates of $2.53.

Publication Date: Feb -16

📋 Highlights
  • Record 2025 Sales & Earnings: Sales hit $4.2B (+6%), adjusted EPS rose to $9.87, and cash returns to shareholders reached record levels.
  • Automation Segment Struggles: Q4 automation sales fell 11% YoY to $240M, offsetting 5.5% overall sales growth driven by pricing and FX.
  • 2030 Financial Targets: Aiming for $6B+ sales, 19% operating margin, $3.7B+ cash flow, and mid-teen EPS CAGR under the RISE strategy.
  • Margin Expansion Strategy: 300-basis-point operating margin improvement through volume leverage (2/3) and enterprise initiatives (1/3) to reach 19%.
  • Capital Allocation Balance: 48% reinvested in growth (e.g., acquisitions, automation) and 52% returned to shareholders via dividends and buybacks.

Segment Performance

The Americas Welding segment performed well, with sales increasing approximately 4% driven by 10.4% higher price and 60 basis points of favorable foreign exchange translation. The segment's adjusted EBIT increased 7% to $141 million, and the adjusted EBIT margin increased 90 basis points to 20%. As Steven Hedlund noted, the company is well-positioned to benefit from cyclical growth in key drivers, including the shortage of skilled welders and infrastructure investments.

Outlook and Guidance

Lincoln Electric expects mid single-digit percent sales growth in 2026, with organic sales split 50-50 between volume and 2025 price actions that carry over to 2026. The company anticipates a mid-20% incremental operating income margin from volume growth and enterprise initiatives. Analysts estimate next year's revenue growth at 5.0%. With a current P/E Ratio of 31.0 and EV/EBITDA of 22.18, the market is pricing in significant growth expectations.

RISE Strategy and 2030 Targets

The company has announced its new RISE strategy, aiming to drive greater efficiency and agility, differentiate its technologies and solutions, and generate value for shareholders. The 2030 financial targets include sales above $6 billion, profit margins expanding at a high 20% incremental operating income margin, and average operating income margin of 19%. With an ROE of 37.15% and ROIC of 18.67%, Lincoln Electric has demonstrated strong profitability.

Valuation and Dividend Yield

With a P/S Ratio of 3.82 and a Dividend Yield of 1.04%, Lincoln Electric's valuation appears reasonable. The company's commitment to returning capital to shareholders is evident in its balanced capital allocation strategy, with approximately 48% invested in growth and 52% returned to shareholders. The Free Cash Flow Yield of 3.31% also suggests a relatively attractive return for investors.

3. NewsRoom

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KMT or LECO: Which Is the Better Value Stock Right Now?

Feb -25

Source: zacks.com

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Lincoln Electric Holdings, Inc. $LECO Holdings Boosted by Hillsdale Investment Management Inc.

Feb -23

Source: defenseworld.net

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Lincoln Electric Board Declares Dividend

Feb -18

Source: businesswire.com

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Lincoln Electric Holdings, Inc. $LECO Shares Sold by ABN Amro Investment Solutions

Feb -16

Source: defenseworld.net

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These Analysts Raise Their Forecasts On Lincoln Electric Following Q4 Results

Feb -13

Source: benzinga.com

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Lincoln Electric Holdings, Inc. (LECO) Q4 2025 Earnings Call Transcript

Feb -12

Source: seekingalpha.com

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Compared to Estimates, Lincoln Electric (LECO) Q4 Earnings: A Look at Key Metrics

Feb -12

Source: zacks.com

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Lincoln Electric Holdings (LECO) Tops Q4 Earnings Estimates

Feb -12

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.61%)

6. Segments

Americas Welding

Expected Growth: 4.65%

Americas Welding from Lincoln Electric Holdings, Inc. growth of 4.65% driven by increasing demand for welding products in construction, automotive, and energy industries, coupled with the company's strategic acquisitions, product innovation, and expansion into emerging markets.

International Welding

Expected Growth: 8.5%

International Welding's 8.5% growth is driven by increasing demand for automation and robotics in manufacturing, infrastructure development, and energy projects. Additionally, Lincoln Electric's strategic acquisitions, expansion in emerging markets, and innovative product offerings have contributed to the segment's growth.

The Harris Products Group

Expected Growth: 4.65%

The Harris Products Group's 4.65% growth is driven by increasing demand for welding consumables and equipment in the construction and manufacturing industries, as well as the company's strategic acquisitions and expansion into emerging markets, such as Asia and Latin America.

7. Detailed Products

Welding Equipment

Lincoln Electric offers a wide range of welding equipment, including MIG, TIG, ARC, and flux cored welding machines, as well as welding accessories and consumables.

Cutting Equipment

Lincoln Electric provides a variety of cutting equipment, including plasma cutting systems, oxy-fuel cutting equipment, and CNC cutting machines.

Additive Welding Solutions

Lincoln Electric offers additive welding solutions, including 3D printing and welding technologies, for the production of complex parts and components.

Automation Solutions

Lincoln Electric provides automation solutions, including robotic welding cells and automated welding systems, for increased efficiency and productivity.

Welding Consumables

Lincoln Electric offers a wide range of welding consumables, including electrodes, wires, and fluxes, for various welding processes.

Welding Safety Equipment

Lincoln Electric provides welding safety equipment, including helmets, gloves, and protective clothing, for welders and welding operators.

8. Lincoln Electric Holdings, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Lincoln Electric Holdings, Inc. is medium due to the availability of alternative welding products and services from competitors.

Bargaining Power Of Customers

The bargaining power of customers for Lincoln Electric Holdings, Inc. is low due to the company's strong brand reputation and customer loyalty.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Lincoln Electric Holdings, Inc. is medium due to the company's dependence on a few key suppliers for raw materials.

Threat Of New Entrants

The threat of new entrants for Lincoln Electric Holdings, Inc. is low due to the high barriers to entry in the welding industry, including significant capital investments and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Lincoln Electric Holdings, Inc. is high due to the competitive nature of the welding industry, with several established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 46.07%
Debt Cost 5.55%
Equity Weight 53.93%
Equity Cost 10.14%
WACC 8.03%
Leverage 85.44%

11. Quality Control: Lincoln Electric Holdings, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Snap-on

A-Score: 6.3/10

Value: 4.3

Growth: 6.0

Quality: 8.2

Yield: 6.0

Momentum: 4.5

Volatility: 9.0

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Timken

A-Score: 5.5/10

Value: 5.8

Growth: 5.0

Quality: 5.2

Yield: 4.0

Momentum: 6.0

Volatility: 7.0

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RBC Bearings

A-Score: 5.3/10

Value: 0.9

Growth: 7.3

Quality: 6.6

Yield: 0.0

Momentum: 8.5

Volatility: 8.7

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Lincoln Electric

A-Score: 5.3/10

Value: 2.2

Growth: 6.4

Quality: 6.6

Yield: 2.0

Momentum: 7.0

Volatility: 7.7

1-Year Total Return ->

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Toro

A-Score: 4.8/10

Value: 3.9

Growth: 5.4

Quality: 6.0

Yield: 3.0

Momentum: 3.0

Volatility: 7.7

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Stanley Black & Decker

A-Score: 4.5/10

Value: 5.1

Growth: 3.1

Quality: 4.2

Yield: 7.0

Momentum: 2.5

Volatility: 5.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

266.8$

Current Price

266.8$

Potential

-0.00%

Expected Cash-Flows