243.76 USD
+4.12 (+1.72%)
243.76 USD
0 (0%)
Overall LECO gets a fundamental rating of 6 out of 10. We evaluated LECO against 132 industry peers in the Machinery industry. LECO has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. LECO is quite expensive at the moment. It does show a decent growth rate.
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.
LECO had positive earnings in each of the past 5 years.
In the past 5 years LECO always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 13.75%, LECO belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
LECO has a better Return On Equity (37.09%) than 95.45% of its industry peers.
Looking at the Return On Invested Capital, with a value of 20.19%, LECO belongs to the top of the industry, outperforming 94.70% of the companies in the same industry.
LECO had an Average Return On Invested Capital over the past 3 years of 21.22%. This is significantly above the industry average of 10.27%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.75% | ||
| ROE | 37.09% | ||
| ROIC | 20.19% |
ROA(3y)14.74%
ROA(5y)12.76%
ROE(3y)40.81%
ROE(5y)36.11%
ROIC(3y)21.22%
ROIC(5y)19.81%
1.3 Margins
LECO has a Profit Margin of 12.56%. This is amongst the best in the industry. LECO outperforms 80.30% of its industry peers.
LECO's Profit Margin has improved in the last couple of years.
LECO has a better Operating Margin (17.54%) than 84.09% of its industry peers.
In the last couple of years the Operating Margin of LECO has grown nicely.
The Gross Margin of LECO (36.68%) is better than 68.94% of its industry peers.
In the last couple of years the Gross Margin of LECO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.54% | ||
| PM (TTM) | 12.56% | ||
| GM | 36.68% |
OM growth 3Y4.56%
OM growth 5Y5.34%
PM growth 3Y10.79%
PM growth 5Y3.57%
GM growth 3Y3.53%
GM growth 5Y1.97%
2. Health
2.1 Basic Checks
LECO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, LECO has less shares outstanding
The number of shares outstanding for LECO has been reduced compared to 5 years ago.
The debt/assets ratio for LECO is higher compared to a year ago.
2.2 Solvency
LECO has an Altman-Z score of 6.87. This indicates that LECO is financially healthy and has little risk of bankruptcy at the moment.
LECO's Altman-Z score of 6.87 is amongst the best of the industry. LECO outperforms 87.88% of its industry peers.
LECO has a debt to FCF ratio of 2.27. This is a good value and a sign of high solvency as LECO would need 2.27 years to pay back of all of its debts.
LECO has a Debt to FCF ratio of 2.27. This is in the better half of the industry: LECO outperforms 74.24% 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 has a worse Debt to Equity ratio (0.88) than 75.76% of its industry peers.
Even though the debt/equity ratio score it not favorable for LECO, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.88 | ||
| Debt/FCF | 2.27 | ||
| Altman-Z | 6.87 |
ROIC/WACC2.16
WACC9.36%
2.3 Liquidity
LECO has a Current Ratio of 1.71. This is a normal value and indicates that LECO is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.71, LECO is not doing good in the industry: 64.39% of the companies in the same industry are doing better.
A Quick Ratio of 1.07 indicates that LECO should not have too much problems paying its short term obligations.
LECO has a Quick ratio of 1.07. This is in the lower half of the industry: LECO underperforms 60.61% 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
The Earnings Per Share has been growing slightly by 6.99% over the past year.
The Earnings Per Share has been growing by 14.62% on average over the past years. This is quite good.
The Revenue has been growing slightly by 3.24% in the past year.
Measured over the past years, LECO shows a small growth in Revenue. The Revenue has been growing by 5.94% on average per year.
EPS 1Y (TTM)6.99%
EPS 3Y14.33%
EPS 5Y14.62%
EPS Q2Q%15.42%
Revenue 1Y (TTM)3.24%
Revenue growth 3Y7.42%
Revenue growth 5Y5.94%
Sales Q2Q%7.87%
3.2 Future
Based on estimates for the next years, LECO will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.54% on average per year.
LECO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.96% yearly.
EPS Next Y6.95%
EPS Next 2Y8.68%
EPS Next 3Y8.88%
EPS Next 5Y9.54%
Revenue Next Year6.47%
Revenue Next 2Y6.26%
Revenue Next 3Y5.84%
Revenue Next 5Y5.96%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
LECO is valuated rather expensively with a Price/Earnings ratio of 24.87.
LECO's Price/Earnings is on the same level as the industry average.
LECO is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.60, which is the current average of the S&P500 Index.
LECO is valuated rather expensively with a Price/Forward Earnings ratio of 22.24.
LECO's Price/Forward Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.23, LECO is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.87 | ||
| Fwd PE | 22.24 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as LECO.
LECO's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.55 | ||
| EV/EBITDA | 17.22 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates LECO does not grow enough to justify the current Price/Earnings ratio.
LECO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.58
PEG (5Y)1.7
EPS Next 2Y8.68%
EPS Next 3Y8.88%
5. Dividend
5.1 Amount
LECO has a Yearly Dividend Yield of 1.32%.
LECO's Dividend Yield is a higher than the industry average which is at 0.91.
LECO's Dividend Yield is slightly below the S&P500 average, which is at 1.93.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
5.2 History
On average, the dividend of LECO grows each year by 8.56%, which is quite nice.
LECO has been paying a dividend for at least 10 years, so it has 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
LECO pays out 31.76% of its income as dividend. This is a sustainable payout ratio.
The dividend of LECO is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP31.76%
EPS Next 2Y8.68%
EPS Next 3Y8.88%
243.76
+4.12 (+1.72%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners80.66%
Inst Owner Change-2.03%
Ins Owners1.48%
Ins Owner Change-0.46%
Market Cap13.41B
Revenue(TTM)4.18B
Net Income(TTM)524.74M
Analysts76.67
Price Target266.04 (9.14%)
Short Float %1.36%
Short Ratio2.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
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)-0.5%
PT rev (3m)2.19%
EPS NQ rev (1m)-0.75%
EPS NQ rev (3m)-2.56%
EPS NY rev (1m)-0.18%
EPS NY rev (3m)1.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.09%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.87 | ||
| Fwd PE | 22.24 | ||
| P/S | 3.21 | ||
| P/FCF | 24.55 | ||
| P/OCF | 20.26 | ||
| P/B | 9.48 | ||
| P/tB | 25.47 | ||
| EV/EBITDA | 17.22 |
EPS(TTM)9.8
EY4.02%
EPS(NY)10.96
Fwd EY4.5%
FCF(TTM)9.93
FCFY4.07%
OCF(TTM)12.03
OCFY4.94%
SpS75.89
BVpS25.71
TBVpS9.57
PEG (NY)3.58
PEG (5Y)1.7
Graham Number75.29
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.75% | ||
| ROE | 37.09% | ||
| ROCE | 26.39% | ||
| ROIC | 20.19% | ||
| ROICexc | 22.49% | ||
| ROICexgc | 34.35% | ||
| OM | 17.54% | ||
| PM (TTM) | 12.56% | ||
| GM | 36.68% | ||
| FCFM | 13.09% |
ROA(3y)14.74%
ROA(5y)12.76%
ROE(3y)40.81%
ROE(5y)36.11%
ROIC(3y)21.22%
ROIC(5y)19.81%
ROICexc(3y)24.29%
ROICexc(5y)22.63%
ROICexgc(3y)41.43%
ROICexgc(5y)36.86%
ROCE(3y)27.25%
ROCE(5y)25.47%
ROICexgc growth 3Y8.18%
ROICexgc growth 5Y9.37%
ROICexc growth 3Y1.83%
ROICexc growth 5Y4.58%
OM growth 3Y4.56%
OM growth 5Y5.34%
PM growth 3Y10.79%
PM growth 5Y3.57%
GM growth 3Y3.53%
GM growth 5Y1.97%
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 | 6.87 |
F-Score7
WACC9.36%
ROIC/WACC2.16
Cap/Depr(3y)109.73%
Cap/Depr(5y)95.96%
Cap/Sales(3y)2.33%
Cap/Sales(5y)2.23%
Profit Quality(3y)91.73%
Profit Quality(5y)105.28%
High Growth Momentum
Growth
EPS 1Y (TTM)6.99%
EPS 3Y14.33%
EPS 5Y14.62%
EPS Q2Q%15.42%
EPS Next Y6.95%
EPS Next 2Y8.68%
EPS Next 3Y8.88%
EPS Next 5Y9.54%
Revenue 1Y (TTM)3.24%
Revenue growth 3Y7.42%
Revenue growth 5Y5.94%
Sales Q2Q%7.87%
Revenue Next Year6.47%
Revenue Next 2Y6.26%
Revenue Next 3Y5.84%
Revenue Next 5Y5.96%
EBIT growth 1Y3.45%
EBIT growth 3Y12.31%
EBIT growth 5Y11.6%
EBIT Next Year23.11%
EBIT Next 3Y12.44%
EBIT Next 5Y10.58%
FCF growth 1Y-4.39%
FCF growth 3Y16.82%
FCF growth 5Y7.65%
OCF growth 1Y0.65%
OCF growth 3Y17.94%
OCF growth 5Y8.24%
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 9 / 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 6.95% 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%.