LINCOLN ELECTRIC HOLDINGS (LECO) Stock Fundamental Analysis
NASDAQ:LECO • US5339001068
286.13 USD
-1.99 (-0.69%)
At close: Feb 20, 2026
286.13 USD
0 (0%)
After Hours: 2/20/2026, 8:00:01 PM
LECO gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 131 industry peers in the Machinery industry. LECO scores excellent points on both the profitability and health parts. This is a solid base for a good stock. LECO is quite expensive at the moment. It does show a decent growth rate. This makes LECO very considerable for quality investing!
1. Profitability
1.1 Basic Checks
- In the past year LECO was profitable.
- In the past year LECO had a positive cash flow from operations.
- Each year in the past 5 years LECO has been profitable.
- Each year in the past 5 years LECO had a positive operating cash flow.
1.2 Ratios
- LECO has a better Return On Assets (13.75%) than 93.13% of its industry peers.
- LECO's Return On Equity of 37.09% is amongst the best of the industry. LECO outperforms 95.42% of its industry peers.
- LECO has a better Return On Invested Capital (19.89%) than 95.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.75% | ||
| ROE | 37.09% | ||
| ROIC | 19.89% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- The Profit Margin of LECO (12.56%) is better than 80.92% of its industry peers.
- In the last couple of years the Profit Margin of LECO has grown nicely.
- LECO has a better Operating Margin (17.54%) than 83.21% of its industry peers.
- In the last couple of years the Operating Margin of LECO has grown nicely.
- LECO has a better Gross Margin (36.68%) than 68.70% of its industry peers.
- LECO's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.54% | ||
| PM (TTM) | 12.56% | ||
| GM | 36.68% |
OM growth 3Y1.06%
OM growth 5Y6.78%
PM growth 3Y-0.69%
PM growth 5Y9.64%
GM growth 3Y2.16%
GM growth 5Y2.04%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LECO is creating value.
- LECO has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- An Altman-Z score of 7.48 indicates that LECO is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 7.48, LECO belongs to the top of the industry, outperforming 90.08% of the companies in the same industry.
- The Debt to FCF ratio of LECO is 2.27, which is a good value as it means it would take LECO, 2.27 years of fcf income to pay off all of its debts.
- LECO's Debt to FCF ratio of 2.27 is fine compared to the rest of the industry. LECO outperforms 75.57% of its industry peers.
- LECO has a Debt/Equity ratio of 0.88. This is a neutral value indicating LECO is somewhat dependend on debt financing.
- LECO's Debt to Equity ratio of 0.88 is on the low side compared to the rest of the industry. LECO is outperformed by 75.57% of its industry peers.
- Although LECO does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.88 | ||
| Debt/FCF | 2.27 | ||
| Altman-Z | 7.48 |
ROIC/WACC2.19
WACC9.1%
2.3 Liquidity
- A Current Ratio of 1.71 indicates that LECO should not have too much problems paying its short term obligations.
- With a Current ratio value of 1.71, LECO is not doing good in the industry: 64.12% of the companies in the same industry are doing better.
- LECO has a Quick Ratio of 1.07. This is a normal value and indicates that LECO is financially healthy and should not expect problems in meeting its short term obligations.
- LECO has a worse Quick ratio (1.07) than 62.60% of its industry peers.
- LECO does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.71 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
- LECO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.47%.
- The Earnings Per Share has been growing by 19.00% on average over the past years. This is quite good.
- Looking at the last year, LECO shows a small growth in Revenue. The Revenue has grown by 5.60% in the last year.
- The Revenue has been growing by 9.78% on average over the past years. This is quite good.
EPS 1Y (TTM)6.47%
EPS 3Y6.15%
EPS 5Y19%
EPS Q2Q%3.11%
Revenue 1Y (TTM)5.6%
Revenue growth 3Y4.02%
Revenue growth 5Y9.78%
Sales Q2Q%5.55%
3.2 Future
- The Earnings Per Share is expected to grow by 10.21% on average over the next years. This is quite good.
- LECO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.83% yearly.
EPS Next Y11.78%
EPS Next 2Y10.33%
EPS Next 3Y10.88%
EPS Next 5Y10.21%
Revenue Next Year6.42%
Revenue Next 2Y5.86%
Revenue Next 3Y5.49%
Revenue Next 5Y5.83%
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 28.96, the valuation of LECO can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of LECO is on the same level as its industry peers.
- The average S&P500 Price/Earnings ratio is at 26.99. LECO is around the same levels.
- With a Price/Forward Earnings ratio of 25.91, LECO can be considered very expensive at the moment.
- LECO's Price/Forward Earnings ratio is in line with the industry average.
- When comparing the Price/Forward Earnings ratio of LECO to the average of the S&P500 Index (28.06), we can say LECO is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.96 | ||
| Fwd PE | 25.91 |
4.2 Price Multiples
- LECO's Enterprise Value to EBITDA is on the same level as the industry average.
- The rest of the industry has a similar Price/Free Cash Flow ratio as LECO.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.81 | ||
| EV/EBITDA | 20.17 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- LECO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.46
PEG (5Y)1.52
EPS Next 2Y10.33%
EPS Next 3Y10.88%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.09%, LECO has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 1.17, LECO pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.85, LECO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.09% |
5.2 History
- The dividend of LECO is nicely growing with an annual growth rate of 8.56%!
- LECO has paid a dividend for at least 10 years, which is a reliable track record.
- LECO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.56%
Div Incr Years24
Div Non Decr Years24
5.3 Sustainability
- 31.76% of the earnings are spent on dividend by LECO. This is a low number and sustainable payout ratio.
- LECO's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP31.76%
EPS Next 2Y10.33%
EPS Next 3Y10.88%
286.13
-1.99 (-0.69%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-12 2026-02-12/bmo
Earnings (Next)04-28 2026-04-28/bmo
Inst Owners80.66%
Inst Owner Change2.17%
Ins Owners1.48%
Ins Owner Change0.09%
Market Cap15.75B
Revenue(TTM)4.23B
Net Income(TTM)524.74M
Analysts75.56
Price Target275.24 (-3.81%)
Short Float %1.13%
Short Ratio1.66
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.09% |
Yearly Dividend2.87
Dividend Growth(5Y)8.56%
DP31.76%
Div Incr Years24
Div Non Decr Years24
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.05%
Min EPS beat(2)-0.08%
Max EPS beat(2)10.19%
EPS beat(4)2
Avg EPS beat(4)7.69%
Min EPS beat(4)-5.1%
Max EPS beat(4)25.75%
EPS beat(8)6
Avg EPS beat(8)5.39%
EPS beat(12)9
Avg EPS beat(12)4.35%
EPS beat(16)13
Avg EPS beat(16)5.44%
Revenue beat(2)1
Avg Revenue beat(2)0.75%
Min Revenue beat(2)-1%
Max Revenue beat(2)2.51%
Revenue beat(4)3
Avg Revenue beat(4)0.66%
Min Revenue beat(4)-1%
Max Revenue beat(4)2.51%
Revenue beat(8)4
Avg Revenue beat(8)-1.1%
Revenue beat(12)4
Avg Revenue beat(12)-1.59%
Revenue beat(16)8
Avg Revenue beat(16)-0.77%
PT rev (1m)3.46%
PT rev (3m)4.58%
EPS NQ rev (1m)0.6%
EPS NQ rev (3m)0.3%
EPS NY rev (1m)0.21%
EPS NY rev (3m)0.08%
Revenue NQ rev (1m)0.45%
Revenue NQ rev (3m)0.72%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)0.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.96 | ||
| Fwd PE | 25.91 | ||
| P/S | 3.77 | ||
| P/FCF | 28.81 | ||
| P/OCF | 23.78 | ||
| P/B | 11.13 | ||
| P/tB | 29.89 | ||
| EV/EBITDA | 20.17 |
EPS(TTM)9.88
EY3.45%
EPS(NY)11.04
Fwd EY3.86%
FCF(TTM)9.93
FCFY3.47%
OCF(TTM)12.03
OCFY4.2%
SpS75.89
BVpS25.71
TBVpS9.57
PEG (NY)2.46
PEG (5Y)1.52
Graham Number75.59
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.75% | ||
| ROE | 37.09% | ||
| ROCE | 26.39% | ||
| ROIC | 19.89% | ||
| ROICexc | 22.16% | ||
| ROICexgc | 33.85% | ||
| OM | 17.54% | ||
| PM (TTM) | 12.56% | ||
| GM | 36.68% | ||
| FCFM | 13.09% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y1.06%
OM growth 5Y6.78%
PM growth 3Y-0.69%
PM growth 5Y9.64%
GM growth 3Y2.16%
GM growth 5Y2.04%
F-Score7
Asset Turnover1.09
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.88 | ||
| Debt/FCF | 2.27 | ||
| Debt/EBITDA | 1.49 | ||
| Cap/Depr | 120.16% | ||
| Cap/Sales | 2.77% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.88% | ||
| Profit Quality | 104.15% | ||
| Current Ratio | 1.71 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 7.48 |
F-Score7
WACC9.1%
ROIC/WACC2.19
Cap/Depr(3y)121.99%
Cap/Depr(5y)107.02%
Cap/Sales(3y)2.69%
Cap/Sales(5y)2.38%
Profit Quality(3y)103.95%
Profit Quality(5y)97.45%
High Growth Momentum
Growth
EPS 1Y (TTM)6.47%
EPS 3Y6.15%
EPS 5Y19%
EPS Q2Q%3.11%
EPS Next Y11.78%
EPS Next 2Y10.33%
EPS Next 3Y10.88%
EPS Next 5Y10.21%
Revenue 1Y (TTM)5.6%
Revenue growth 3Y4.02%
Revenue growth 5Y9.78%
Sales Q2Q%5.55%
Revenue Next Year6.42%
Revenue Next 2Y5.86%
Revenue Next 3Y5.49%
Revenue Next 5Y5.83%
EBIT growth 1Y3.45%
EBIT growth 3Y5.12%
EBIT growth 5Y17.21%
EBIT Next Year23.15%
EBIT Next 3Y12.93%
EBIT Next 5Y11.07%
FCF growth 1Y6.07%
FCF growth 3Y19.7%
FCF growth 5Y12.82%
OCF growth 1Y5.95%
OCF growth 3Y19.92%
OCF growth 5Y13.48%
LINCOLN ELECTRIC HOLDINGS / LECO FAQ
What is the fundamental rating for LECO stock?
ChartMill assigns a fundamental rating of 6 / 10 to LECO.
What is the valuation status of LINCOLN ELECTRIC HOLDINGS (LECO) stock?
ChartMill assigns a valuation rating of 3 / 10 to LINCOLN ELECTRIC HOLDINGS (LECO). This can be considered as Overvalued.
What is the profitability of LECO stock?
LINCOLN ELECTRIC HOLDINGS (LECO) has a profitability rating of 8 / 10.
What is the earnings growth outlook for LINCOLN ELECTRIC HOLDINGS?
The Earnings per Share (EPS) of LINCOLN ELECTRIC HOLDINGS (LECO) is expected to grow by 11.78% in the next year.
How sustainable is the dividend of LINCOLN ELECTRIC HOLDINGS (LECO) stock?
The dividend rating of LINCOLN ELECTRIC HOLDINGS (LECO) is 6 / 10 and the dividend payout ratio is 31.76%.