Lincoln Electric (NASDAQ:LECO) Shares Gap Up Following Strong Earnings

Key Points

• Lincoln Electric beat earnings expectations, reporting quarterly EPS of $2.98 versus the $2.81 consensus estimate, while revenue increased 15.1% year over year.
• The strong results drove the stock up 6.2%, with shares opening at $275.01 after closing at $258.65. Analysts maintain a “Moderate Buy” consensus rating and an average price target of $306.78.
• The company raised its quarterly dividend to $0.87 per share, equivalent to $3.48 annually and a 1.3% yield; institutional investors own 79.61% of the stock.

Lincoln Electric Holdings, Inc. (NASDAQ:LECO - Get Free Report)'s stock price gapped up before the market opened on Tuesday following a stronger than expected earnings report. The stock had previously closed at $258.65, but opened at $275.01. Lincoln Electric shares last traded at $275.9480, with a volume of 66,203 shares traded.

The industrial products company reported $2.98 earnings per share for the quarter, topping analysts' consensus estimates of $2.81 by $0.17. Lincoln Electric had a return on equity of 39.23% and a net margin of 12.35%. During the same period last year, the business earned $2.47 earnings per share. The business's quarterly revenue was up 15.1% on a year-over-year basis.

Lincoln Electric Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Friday, January 15th. Investors of record on Thursday, December 31st will be issued a $0.87 dividend. The ex-dividend date of this dividend is Thursday, December 31st. This represents a $3.48 dividend on an annualized basis and a yield of 1.3%. This is a boost from Lincoln Electric's previous quarterly dividend of $0.79. Lincoln Electric's payout ratio is presently 31.57%.

Wall Street Analysts Forecast Growth

LECO has been the subject of a number of research analyst reports. UBS Group began coverage on shares of Lincoln Electric in a report on Monday, August 10th. They set a "buy" rating and a $340.00 price objective for the company. Morgan Stanley raised shares of Lincoln Electric from an "underweight" rating to an "equal weight" rating and boosted their target price for the stock from $257.00 to $283.00 in a report on Monday, August 10th. Weiss Ratings upgraded shares of Lincoln Electric from a "buy (b-)" rating to a "buy (b)" rating in a report on Thursday, October 8th. Stifel Nicolaus set a $271.00 price target on shares of Lincoln Electric in a report on Monday, October 19th. Finally, Wall Street Zen cut shares of Lincoln Electric from a "buy" rating to a "hold" rating in a research note on Saturday, October 10th. One investment analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and four have given a Hold rating to the company. Based on data from MarketBeat, the company has an average rating of "Moderate Buy" and an average price target of $306.78.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of LECO. Mather Group LLC. lifted its position in shares of Lincoln Electric by 5.1% during the third quarter. Mather Group LLC. now owns 859 shares of the industrial products company's stock worth $227,000 after purchasing an additional 42 shares in the last quarter. Earned Wealth Advisors LLC increased its holdings in Lincoln Electric by 3.8% in the first quarter. Earned Wealth Advisors LLC now owns 1,177 shares of the industrial products company's stock valued at $293,000 after purchasing an additional 43 shares during the last quarter. Sumitomo Mitsui DS Asset Management Company Ltd raised its position in shares of Lincoln Electric by 1.2% in the 3rd quarter. Sumitomo Mitsui DS Asset Management Company Ltd now owns 4,220 shares of the industrial products company's stock valued at $1,117,000 after acquiring an additional 51 shares during the period. Parallel Advisors LLC grew its holdings in shares of Lincoln Electric by 9.4% in the 1st quarter. Parallel Advisors LLC now owns 606 shares of the industrial products company's stock valued at $151,000 after buying an additional 52 shares during the period. Finally, Jackson Thornton Wealth Management LLC increased its holdings in shares of Lincoln Electric by 4.6% in the first quarter. Jackson Thornton Wealth Management LLC now owns 1,241 shares of the industrial products company's stock worth $318,000 after acquiring an additional 55 shares in the last quarter. 79.61% of the stock is currently owned by institutional investors.

Lincoln Electric Trading Up 6.2%

The company has a current ratio of 1.98, a quick ratio of 1.20 and a debt-to-equity ratio of 0.74. The business has a 50 day moving average of $267.97 and a 200-day moving average of $265.31. The firm has a market capitalization of $14.98 billion, a P/E ratio of 27.35, a PEG ratio of 1.53 and a beta of 1.21.

Lincoln Electric Company Profile

Lincoln Electric Holdings, Inc NASDAQ: LECO is a global manufacturer of welding, cutting and industrial automation products. The company serves customers in industries including construction, manufacturing, energy, transportation and heavy equipment.

Its product portfolio includes arc-welding equipment, welding consumables such as electrodes and welding wire, plasma-cutting systems, welding accessories and personal protective equipment. Lincoln Electric also provides robotic and automated welding systems, industrial automation solutions, application engineering, training and maintenance services.

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