ESAB Corporation (ESAB)
NYSE:ESAB
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ESAB Corporation
(NYSE:ESAB)
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Rating:62Neutral
Price Target:
$109.00
▲(5.88% Upside)
Action:ReiteratedDate:04/09/26
The score is driven primarily by solid underlying profitability and manageable leverage, tempered by a clear step-down in recent earnings and free cash flow versus 2024. Technicals remain mixed with the stock still below longer-term moving averages, and valuation is a notable headwind given the high P/E and low yield. The Eddyfi acquisition is strategically positive, but adds near-term execution and financing risk.
Positive Factors
Profitability & Margins
Sustained mid-30% gross margins and ~16% EBIT margin indicate durable product-level profitability and pricing power across equipment and consumables. These margins support reinvestment, buffer cyclical volumes, and make the core business resilient to moderate cost or volume shocks over the medium term.
Negative Factors
Weaker Cash Generation Trend
Free cash flow and operating cash flow have declined meaningfully versus the prior year, reducing internal funding capacity for M&A, capex, or shareholder returns. If the lighter cash conversion persists it could constrain strategic flexibility and increase reliance on external financing.
Read all positive and negative factors
Positive Factors
Negative Factors
Profitability & Margins
Sustained mid-30% gross margins and ~16% EBIT margin indicate durable product-level profitability and pricing power across equipment and consumables. These margins support reinvestment, buffer cyclical volumes, and make the core business resilient to moderate cost or volume shocks over the medium term.
Read all positive factors
ESAB Corporation (ESAB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.21B
Dividend Yield0.33%
Average Volume (3M)653.37K
Price to Earnings (P/E)45.2
Beta (1Y)1.15
Revenue Growth1.19%
EPS Growth-7.78%
CountryUS
Employees8,000
SectorIndustrials
Sector Strength72
IndustryManufacturing - Metal Fabrication
Share Statistics
EPS (TTM)1.35
Shares Outstanding60,728,710
10 Day Avg. Volume829,897
30 Day Avg. Volume653,368
Financial Highlights & Ratios
PEG Ratio-2.05
Price to Book (P/B)3.14
Price to Sales (P/S)2.40
P/FCF Ratio31.92
Enterprise Value/Market Cap1.20
Enterprise Value/Revenue2.61
Enterprise Value/Gross Profit7.35
Enterprise Value/Ebitda14.92
Forecast
1Y Price Target
$141.17Price Target Upside37.12% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)5.81
Revenue Forecast (FY)$2.92B
ESAB Corporation Business Overview & Revenue Model
Company Description
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 elect...
How the Company Makes Money
ESAB primarily makes money by selling welding and cutting equipment and the recurring consumables used with that equipment. A major revenue stream comes from consumables (e.g., welding wire, electrodes, filler metals, and fluxes) that customers mu...
ESAB Corporation Earnings Call Summary
Earnings Call Date:Oct 29, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with solid financial performance, demonstrated by increased sales and EBITDA growth, along with the successful acquisition of EWM. The company also showed strong cash flow and raised its full-year guidance. However, there were some challenges related to tariffs in the Americas and deferred revenues in Mexico and automation, which impacted margins.Positive Updates
Organic Growth and Sales Increase
Sales rose 8% to $687 million, with organic sales increasing 2% year-over-year. This reflects solid improvement in the Americas and continued strength in EMEA and APAC.
Negative Updates
Tariff Impact in the Americas
Adjusted EBITDA margin in the Americas was affected by ongoing investments, with a drag driven by price/cost dynamics related to tariffs.
Read all updates
Q3-2025 Updates
Positive
Negative
Organic Growth and Sales Increase
Sales rose 8% to $687 million, with organic sales increasing 2% year-over-year. This reflects solid improvement in the Americas and continued strength in EMEA and APAC.
Read all positive updates
Company Guidance
During the ESAB Third Quarter 2025 Earnings Conference Call, the company raised its full-year guidance based on strong financial performance. Sales increased by 8% year-over-year to $687 million, with organic sales rising by 2%. Adjusted EBITDA grew by 7% to $133 million. The recently acquired EWM contributed positively to growth, adding approximately 2 points of growth and $1 million in adjusted EBITDA. ESAB's full-year guidance for total sales is now between $2.71 billion and $2.73 billion, with an adjusted EBITDA forecast of $535 million to $540 million. The company expects to achieve a return on invested capital of more than 10% within three years from EWM, and adjusted EPS is projected between $5.20 and $5.30. Despite some tariff-related headwinds in the Americas, ESAB anticipates strong margin improvement in 2026, driven by pricing strategies, restructuring initiatives, and manufacturing adjustments. The company remains committed to long-term shareholder value through both organic growth and strategic M&A activities.ESAB Corporation Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
71
Positive
Cash Flow
63
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.84B | 2.74B | 2.77B | 2.59B | 2.43B |
| Gross Profit | 1.01B | 1.04B | 1.02B | 885.53M | 837.98M |
| EBITDA | 491.56M | 531.41M | 509.37M | 435.40M | 404.83M |
| Net Income | 226.77M | 264.84M | 205.28M | 223.75M | 235.11M |
Balance Sheet | |||||
| Total Assets | 4.77B | 4.03B | 3.83B | 3.75B | 3.46B |
| Cash, Cash Equivalents and Short-Term Investments | 185.86M | 249.36M | 102.00M | 72.02M | 41.21M |
| Total Debt | 1.43B | 1.16B | 1.12B | 1.31B | 109.24M |
| Total Liabilities | 2.55B | 2.23B | 2.18B | 2.37B | 959.53M |
| Stockholders Equity | 2.17B | 1.77B | 1.61B | 1.35B | 2.46B |
Cash Flow | |||||
| Free Cash Flow | 213.28M | 303.62M | 282.32M | 174.12M | 215.15M |
| Operating Cash Flow | 260.57M | 355.40M | 330.49M | 214.36M | 250.74M |
| Investing Cash Flow | -479.88M | -205.70M | -62.24M | -184.42M | -35.27M |
| Financing Cash Flow | 113.70M | 31.67M | -219.72M | 7.56M | -221.57M |
ESAB Corporation Technical Analysis
Neutral
102.95
Price Trends
112.81
Negative
113.30
Negative
115.77
Negative
Market Momentum
-3.50
Negative
49.85
Neutral
75.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESAB, the sentiment is Neutral. The current price of 102.95 is above the 20-day moving average (MA) of 97.19, below the 50-day MA of 112.81, and below the 200-day MA of 115.77, indicating a neutral trend. The MACD of -3.50 indicates Negative momentum. The RSI at 49.85 is Neutral, neither overbought nor oversold. The STOCH value of 75.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ESAB.
ESAB Corporation Risk Analysis
ESAB Corporation disclosed 37 risk factors in its most recent earnings report. ESAB Corporation reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ESAB Corporation Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $4.06B | 19.10 | 26.34% | 0.67% | 1.55% | 701.41% | |
78 Outperform | $21.48B | 37.45 | 22.99% | 0.24% | 2.40% | 81.54% | |
74 Outperform | $13.41B | 16.84 | 27.46% | 0.85% | 15.71% | 29.60% | |
70 Outperform | $2.74B | 15.14 | 11.58% | 1.27% | 7.43% | 148.83% | |
69 Neutral | $21.86B | 39.98 | 22.69% | ― | 7.75% | 6.84% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | $6.21B | 45.18 | 10.98% | 0.33% | 1.19% | -7.78% |
* Industrials Sector Average
ESAB
ESAB Corporation
102.25
-12.66
-11.02%
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ESAB Corporation Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
ESAB Appoints New CFO Amid Broader Financial Leadership Changes
Neutral
Apr 2, 2026
On April 2, 2026, ESAB Corporation announced a major financial leadership reshuffle, appointing veteran finance executive R. Brent Jones as executive vice president and chief financial officer, effective in early May 2026, with CEO Shyam Kambeyand...
M&A TransactionsPrivate Placements and Financing
ESAB Issues Senior Notes to Fund Eddyfi Acquisition
Positive
Mar 26, 2026
On March 26, 2026, ESAB Corporation issued $1.0 billion of 5.625% senior unsecured notes due April 1, 2031, guaranteed by certain U.S. subsidiaries and carrying semi-annual interest payments beginning October 1, 2026. The notes feature change-of-c...
Business Operations and StrategyM&A TransactionsPrivate Placements and Financing
ESAB Plans $1 Billion Note Offering to Fund Acquisition
Positive
Mar 12, 2026
On March 12, 2026, ESAB Corporation announced it intends to offer $1 billion of senior notes due 2031 in a private placement to qualified institutional buyers in the U.S. and certain investors abroad. The notes will be guaranteed by certain curren...
Business Operations and StrategyFinancial DisclosuresM&A TransactionsPrivate Placements and Financing
ESAB Announces Eddyfi Acquisition and Financing Initiatives
Positive
Feb 2, 2026
On January 31, 2026, ESAB Corporation agreed via a wholly owned subsidiary to acquire Québec-based Eddyfi Holding Inc. and related entities for $1.45 billion in cash, a deal that will make Eddyfi a wholly owned subsidiary and combine ESABR...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.