239.43 USD
+0.59 (+0.25%)
239.43 USD
0 (0%)
Taking everything into account, LECO scores 6 out of 10 in our fundamental rating. LECO was compared to 130 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making LECO a very profitable company, without any liquidiy or solvency issues. While showing a medium growth rate, LECO is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year LECO was profitable.
LECO had a positive operating cash flow in the past year.
LECO had positive earnings in each of the past 5 years.
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 92.31% of its industry peers.
Looking at the Return On Equity, with a value of 37.09%, LECO belongs to the top of the industry, outperforming 95.38% of the companies in the same industry.
The Return On Invested Capital of LECO (20.19%) is better than 95.38% of its industry peers.
LECO had an Average Return On Invested Capital over the past 3 years of 21.22%. This is significantly above the industry average of 10.34%.
| 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
Looking at the Profit Margin, with a value of 12.56%, LECO belongs to the top of the industry, outperforming 83.08% of the companies in the same industry.
LECO's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 17.54%, LECO belongs to the top of the industry, outperforming 83.08% of the companies in the same industry.
LECO's Operating Margin has improved in the last couple of years.
LECO has a Gross Margin of 36.68%. This is in the better half of the industry: LECO outperforms 67.69% 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so LECO is creating value.
The number of shares outstanding for LECO has been reduced compared to 1 year ago.
Compared to 5 years ago, LECO has less shares outstanding
The debt/assets ratio for LECO is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 6.81 indicates that LECO is not in any danger for bankruptcy at the moment.
LECO has a better Altman-Z score (6.81) than 88.46% 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.
With a decent Debt to FCF ratio value of 2.27, LECO is doing good in the industry, outperforming 74.62% of the companies in the same industry.
A Debt/Equity ratio of 0.88 indicates that LECO is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.88, LECO is doing worse than 75.38% of the companies in the same industry.
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 | 6.81 |
ROIC/WACC2.19
WACC9.2%
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: 64.62% 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.
Looking at the Quick ratio, with a value of 1.07, LECO is doing worse than 61.54% of the companies in the same industry.
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 6.99%.
LECO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 14.62% yearly.
Looking at the last year, LECO shows a small growth in Revenue. The Revenue has grown by 3.24% in the last 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.
The Revenue is expected to grow by 5.96% on average over the next years.
EPS Next Y7.08%
EPS Next 2Y8.75%
EPS Next 3Y8.96%
EPS Next 5Y9.54%
Revenue Next Year6.35%
Revenue Next 2Y6.1%
Revenue Next 3Y5.77%
Revenue Next 5Y5.96%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
With a Price/Earnings ratio of 24.43, LECO is valued on the expensive side.
LECO's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.15. LECO is around the same levels.
The Price/Forward Earnings ratio is 21.82, which indicates a rather expensive current valuation of LECO.
LECO's Price/Forward Earnings is on the same level as the industry average.
LECO's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 36.12.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.43 | ||
| Fwd PE | 21.82 |
4.2 Price Multiples
LECO's Enterprise Value to EBITDA ratio is in line with the industry average.
LECO's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.18 | ||
| EV/EBITDA | 16.94 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of LECO may justify a higher PE ratio.
PEG (NY)3.45
PEG (5Y)1.67
EPS Next 2Y8.75%
EPS Next 3Y8.96%
5. Dividend
5.1 Amount
LECO has a Yearly Dividend Yield of 1.40%.
Compared to an average industry Dividend Yield of 1.97, LECO pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.41, LECO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.4% |
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
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 2Y8.75%
EPS Next 3Y8.96%
239.43
+0.59 (+0.25%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners81.51%
Inst Owner Change-2.04%
Ins Owners1.48%
Ins Owner Change-0.72%
Market Cap13.21B
Revenue(TTM)4.18B
Net Income(TTM)524.74M
Analysts76.67
Price Target267.36 (11.67%)
Short Float %1.58%
Short Ratio2.54
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.4% |
Yearly Dividend2.87
Dividend Growth(5Y)8.56%
DP31.76%
Div Incr Years24
Div Non Decr Years24
Ex-Date
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)2.7%
PT rev (3m)3.78%
EPS NQ rev (1m)-2.2%
EPS NQ rev (3m)-1.9%
EPS NY rev (1m)0.19%
EPS NY rev (3m)0.42%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0.68%
Revenue NY rev (3m)0.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.43 | ||
| Fwd PE | 21.82 | ||
| P/S | 3.16 | ||
| P/FCF | 24.18 | ||
| P/OCF | 19.96 | ||
| P/B | 9.34 | ||
| P/tB | 25.09 | ||
| EV/EBITDA | 16.94 |
EPS(TTM)9.8
EY4.09%
EPS(NY)10.98
Fwd EY4.58%
FCF(TTM)9.9
FCFY4.14%
OCF(TTM)12
OCFY5.01%
SpS75.67
BVpS25.63
TBVpS9.54
PEG (NY)3.45
PEG (5Y)1.67
Graham Number75.18
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 | 6.81 |
F-Score7
WACC9.2%
ROIC/WACC2.19
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 Y7.08%
EPS Next 2Y8.75%
EPS Next 3Y8.96%
EPS Next 5Y9.54%
Revenue 1Y (TTM)3.24%
Revenue growth 3Y7.42%
Revenue growth 5Y5.94%
Sales Q2Q%7.87%
Revenue Next Year6.35%
Revenue Next 2Y6.1%
Revenue Next 3Y5.77%
Revenue Next 5Y5.96%
EBIT growth 1Y3.45%
EBIT growth 3Y12.31%
EBIT growth 5Y11.6%
EBIT Next Year22.32%
EBIT Next 3Y11.48%
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.
Can you provide the valuation status for LINCOLN ELECTRIC HOLDINGS?
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.
Can you provide the financial health for LECO stock?
The financial health rating of LINCOLN ELECTRIC HOLDINGS (LECO) is 7 / 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 7.08% in the next year.