245.41 USD
+1.36 (+0.56%)
245.41 USD
0 (0%)
LECO gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 130 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 valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
LECO had positive earnings in the past year.
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
With an excellent Return On Assets value of 13.75%, LECO belongs to the best of the industry, outperforming 92.31% of the companies in the same industry.
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.
LECO has a Return On Invested Capital of 20.19%. This is amongst the best in the industry. LECO outperforms 95.38% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for LECO is significantly above the industry average of 10.39%.
| 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
The Profit Margin of LECO (12.56%) is better than 83.08% of its industry peers.
In the last couple of years the Profit Margin of LECO has grown nicely.
LECO has a Operating Margin of 17.54%. This is amongst the best in the industry. LECO outperforms 83.08% of its industry peers.
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LECO is creating value.
The number of shares outstanding for LECO has been reduced compared to 1 year ago.
The number of shares outstanding for LECO has been reduced compared to 5 years ago.
LECO has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 6.88 indicates that LECO is not in any danger for bankruptcy at the moment.
LECO has a better Altman-Z score (6.88) 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.
LECO has a better Debt to FCF ratio (2.27) than 74.62% 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 Debt to Equity ratio of 0.88. This is in the lower half of the industry: LECO underperforms 75.38% 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 | 6.88 |
ROIC/WACC2.17
WACC9.31%
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: 65.38% 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 worse Quick ratio (1.07) than 62.31% of its industry peers.
The current and quick ratio evaluation for LECO is rather negative, while it does have 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.
Based on estimates for the next years, LECO will show a small growth in Revenue. The Revenue will grow by 5.96% on average per year.
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
A Price/Earnings ratio of 25.04 indicates a quite expensive valuation of LECO.
Compared to the rest of the industry, the Price/Earnings ratio of LECO is on the same level as its industry peers.
LECO's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.46.
The Price/Forward Earnings ratio is 22.36, which indicates a rather expensive current valuation of LECO.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LECO is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.10, LECO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.04 | ||
| Fwd PE | 22.36 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as LECO.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of LECO is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.71 | ||
| EV/EBITDA | 17.24 |
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.
The excellent profitability rating of LECO may justify a higher PE ratio.
PEG (NY)3.54
PEG (5Y)1.71
EPS Next 2Y8.75%
EPS Next 3Y8.96%
5. Dividend
5.1 Amount
LECO has a Yearly Dividend Yield of 1.32%.
Compared to an average industry Dividend Yield of 1.90, LECO pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.32, LECO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.32% |
5.2 History
The dividend of LECO is nicely growing with an annual growth rate of 8.56%!
LECO has been paying a dividend for at least 10 years, so it has a reliable track record.
LECO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
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 2Y8.75%
EPS Next 3Y8.96%
245.41
+1.36 (+0.56%)
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 Cap13.50B
Revenue(TTM)4.18B
Net Income(TTM)524.74M
Analysts76.67
Price Target267.36 (8.94%)
Short Float %1.26%
Short Ratio1.94
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-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)-0.09%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0.68%
Revenue NY rev (3m)0.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.04 | ||
| Fwd PE | 22.36 | ||
| P/S | 3.23 | ||
| P/FCF | 24.71 | ||
| P/OCF | 20.4 | ||
| P/B | 9.55 | ||
| P/tB | 25.64 | ||
| EV/EBITDA | 17.24 |
EPS(TTM)9.8
EY3.99%
EPS(NY)10.98
Fwd EY4.47%
FCF(TTM)9.93
FCFY4.05%
OCF(TTM)12.03
OCFY4.9%
SpS75.89
BVpS25.71
TBVpS9.57
PEG (NY)3.54
PEG (5Y)1.71
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 | 6.88 |
F-Score7
WACC9.31%
ROIC/WACC2.17
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.