Lincoln Electric Holdings (LECO)
NASDAQ:LECO
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Lincoln Electric Holdings
(NASDAQ:LECO)
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Rating:72Outperform
Price Target:
$284.00
▲(9.17% Upside)
Action:ReiteratedDate:02/14/26
LECO scores well on fundamental strength and a strong technical uptrend, supported by generally positive guidance and credible long-term targets. The main offsets are valuation (high P/E with a modest yield) and execution risk from leverage and near-term cash-flow/volume and margin pressures highlighted on the earnings call.
Positive Factors
Recurring Consumables Revenue
Lincoln's consumables business is inherently recurring and tied to ongoing welding activity, providing a stable, less cyclical revenue base that supports predictable gross margins and cash flow. This recurring stream cushions equipment cyclicality and underpins long‑term revenue resilience.
Negative Factors
Moderate-to-Elevated Leverage
Debt roughly equal to equity limits financial flexibility and increases sensitivity to interest costs and cash‑flow swings. Elevated leverage constrains the ability to expand opportunistically or absorb prolonged cyclical weakness, making balance‑sheet management a persistent strategic priority.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring Consumables Revenue
Lincoln's consumables business is inherently recurring and tied to ongoing welding activity, providing a stable, less cyclical revenue base that supports predictable gross margins and cash flow. This recurring stream cushions equipment cyclicality and underpins long‑term revenue resilience.
Read all positive factors
Lincoln Electric Holdings (LECO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$14.04B
Dividend Yield1.22%
Average Volume (3M)342.62K
Price to Earnings (P/E)25.5
Beta (1Y)1.05
Revenue Growth3.27%
EPS Growth10.89%
CountryUS
Employees12,000
SectorIndustrials
Sector Strength72
IndustryManufacturing - Tools & Accessories
Share Statistics
EPS (TTM)2.65
Shares Outstanding54,823,760
10 Day Avg. Volume417,522
30 Day Avg. Volume342,617
Financial Highlights & Ratios
PEG Ratio1.81
Price to Book (P/B)9.03
Price to Sales (P/S)3.14
P/FCF Ratio24.86
Enterprise Value/Market Cap1.09
Enterprise Value/Revenue3.60
Enterprise Value/Gross Profit9.92
Enterprise Value/Ebitda18.90
Forecast
1Y Price Target
$298.75Price Target Upside14.84% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)10.84
Revenue Forecast (FY)$4.51B
Lincoln Electric Holdings Business Overview & Revenue Model
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 H...
How the Company Makes Money
Lincoln Electric primarily makes money by selling welding-related products and solutions to industrial customers. Key revenue streams include: (1) Welding equipment sales: revenue from power sources, wire feeders, torches, cutting equipment, and o...
Lincoln Electric Holdings Key Performance Indicators (KPIs)
Lincoln Electric Holdings Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive outlook: management reported record full-year sales and adjusted EPS, strong cash generation and shareholder returns, permanent savings, top-quartile ROIC, and detailed an ambitious RISE strategy with clear 2030 targets. However, notable near-term challenges remain — volume declines (especially in automation and some international markets), gross margin compression in Q4, higher adjusted tax rate, elevated working capital, Q1 incentive cost pressure, and metal-price volatility. Management expects volume recovery to begin in the second quarter of 2026 and has confidence in automation orders/backlog and enterprise initiatives to drive margin expansion over the strategy period. On balance, the positive results, strong cash and capital return profile, and credible multi-year targets outweigh the current operational headwinds and cyclical softness.Positive Updates
Record Full-Year Results
2025 sales increased 6% to a record $4,200,000,000 (driven by acquisitions and price). Adjusted EPS rose to a record $9.87 and adjusted operating income margin was sustained at prior-year record levels.
Negative Updates
Volume Weakness and Automation Declines
Volume was a headwind: consolidated volumes declined 6.4% in Q4. Automation sales were $240,000,000 in Q4 (down 11% vs. prior year) and automation fell mid-single-digits for the full year at $870,000,000, pressuring equipment-related revenue.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Full-Year Results
2025 sales increased 6% to a record $4,200,000,000 (driven by acquisitions and price). Adjusted EPS rose to a record $9.87 and adjusted operating income margin was sustained at prior-year record levels.
Read all positive updates
Company Guidance
Lincoln’s 2026 guidance calls for mid‑single‑digit sales growth (organic split roughly 50/50 between volume and carryover 2025 price), with Q1 sales steady vs. Q4 and a pivot to volume‑led growth beginning in Q2 (typical 40/60 first‑half/second‑half seasonality); automation (Q4 $240M, FY2025 $870M, down mid‑single‑digits in 2025) is expected to recover to mid‑single‑digit growth and drive much of the volume improvement, price to be strongest in Q1 and largely anniversaryed in Q2 (Harris pricing excludes dynamic metal adders), and the company expects a mid‑20% incremental operating‑income margin from volume and enterprise initiatives in 2026 (ramping to high‑20s incrementals through 2030), an average operating‑income margin of ~19% across the cycle with a peak 20%+ target, sales above $6.0B and mid‑teens EPS CAGR to 2030, CapEx of $110–$130M, a Q1 incentive cost step‑up of ≈$10M, tax rate low‑to‑mid‑20%, interest $50–$55M, a working‑capital target of 16–17% of sales, >$3.7B cash from operations through 2030, and continued balanced capital allocation (≈30% of net income to dividends and about $75M/year in buybacks, with opportunistic additional repurchases).Lincoln Electric Holdings Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
69
Positive
Cash Flow
72
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.23B | 4.01B | 4.19B | 3.76B | 3.23B |
| Gross Profit | 1.54B | 1.48B | 1.48B | 1.28B | 1.07B |
| EBITDA | 825.56M | 800.52M | 789.48M | 708.11M | 675.23M |
| Net Income | 520.53M | 466.11M | 545.25M | 472.22M | 276.58M |
Balance Sheet | |||||
| Total Assets | 3.78B | 3.52B | 3.38B | 3.18B | 2.59B |
| Cash, Cash Equivalents and Short-Term Investments | 308.79M | 377.26M | 393.79M | 197.15M | 192.96M |
| Total Debt | 1.29B | 1.32B | 1.16B | 1.25B | 819.00M |
| Total Liabilities | 2.31B | 2.19B | 2.07B | 2.15B | 1.73B |
| Stockholders Equity | 1.47B | 1.33B | 1.31B | 1.03B | 864.10M |
Cash Flow | |||||
| Free Cash Flow | 534.20M | 482.37M | 576.55M | 311.50M | 302.53M |
| Operating Cash Flow | 661.17M | 598.98M | 667.54M | 383.39M | 365.06M |
| Investing Cash Flow | -257.33M | -361.23M | -74.73M | -504.69M | -205.36M |
| Financing Cash Flow | -461.89M | -244.64M | -412.39M | 133.72M | -221.94M |
Lincoln Electric Holdings Technical Analysis
Positive
260.15
Price Trends
268.79
Negative
256.02
Positive
243.67
Positive
Market Momentum
-4.51
Negative
50.36
Neutral
89.55
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LECO, the sentiment is Positive. The current price of 260.15 is above the 20-day moving average (MA) of 251.52, below the 50-day MA of 268.79, and above the 200-day MA of 243.67, indicating a neutral trend. The MACD of -4.51 indicates Negative momentum. The RSI at 50.36 is Neutral, neither overbought nor oversold. The STOCH value of 89.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LECO.
Lincoln Electric Holdings Risk Analysis
Lincoln Electric Holdings disclosed 19 risk factors in its most recent earnings report. Lincoln Electric Holdings reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lincoln Electric Holdings Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $18.92B | 53.36 | 8.53% | ― | 8.27% | 19.06% | |
78 Outperform | $19.77B | 17.98 | 17.70% | 2.52% | 0.24% | -1.85% | |
72 Outperform | $14.04B | 25.51 | 37.15% | 1.22% | 3.27% | 10.89% | |
72 Outperform | $7.45B | 20.35 | 9.35% | 1.61% | -1.01% | -12.13% | |
65 Neutral | $2.96B | 16.15 | 8.61% | 2.74% | -2.63% | -4.46% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
55 Neutral | $11.21B | 28.82 | 4.47% | 4.42% | -1.40% | ― |
* Industrials Sector Average
LECO
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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.