Lincoln Electric Holdings, Inc. (NASDAQ:LECO)

CAPS Rating: 5 out of 5

The Company is a full-line manufacturer and reseller of welding and cutting products. Welding products include arc welding power sources, wire feeding systems, robotic welding packages, fume extraction equipment, consumable electrodes and fluxes.

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Member Avatar pchop12316 (70.94) Submitted: 8/27/2014 2:43:06 PM : Outperform Start Price: $70.98 LECO Score: +2.95

solid company with very good financials and currently still at an attractive price

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Member Avatar hrejvani (< 20) Submitted: 6/1/2014 11:24:49 PM : Outperform Start Price: $65.43 LECO Score: +7.80

expansion in africa and bricks

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Member Avatar DanFPilot (51.14) Submitted: 5/8/2014 3:49:27 PM : Outperform Start Price: $66.82 LECO Score: +2.67

Seems like a good company. Purchased it for my Roth. Boring but consistent.

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Member Avatar ayaghsizian (98.30) Submitted: 2/5/2014 9:37:52 AM : Outperform Start Price: $67.88 LECO Score: -6.79

What a great company!!!

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Member Avatar txlonghorn (82.89) Submitted: 1/25/2014 9:32:08 AM : Outperform Start Price: $67.95 LECO Score: -4.24

Overseas growth potential is strong.

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Member Avatar RV74G (< 20) Submitted: 12/26/2013 3:58:02 PM : Outperform Start Price: $71.27 LECO Score: -6.32

Lincoln manufacturers portable welding machines. It's performance has been consistent for decades. May look like a boring technology. But is worth consideration.

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Member Avatar TMFJMo (69.25) Submitted: 10/2/2013 1:27:40 PM : Outperform Start Price: $67.41 LECO Score: -9.96

http://www.jmocapital.com/1/post/2013/10/buy-this-stock-today-and-tuck-it-away.html

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Member Avatar chileman13 (< 20) Submitted: 8/20/2013 11:26:35 PM : Underperform Start Price: $60.69 LECO Score: +0.82

The main problem I have with Lincoln Electric is their current direction of taking business away from their own distributors and going direct to the end users. They are cutting out the people who have been loyal to them to increase their direct sales. Welding distributors across the board are becoming increasingly upset with this move. It is my belief this will backfire. Distributors will and are currently fighting back.

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Member Avatar seattle1115 (84.15) Submitted: 4/2/2013 12:22:23 PM : Outperform Start Price: $51.72 LECO Score: +13.79

I waited for the price to come down a bit before I invested, but now I feel comfortable buying for the long term.

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Member Avatar FutureMonkey (82.81) Submitted: 3/2/2013 2:58:54 PM : Outperform Start Price: $54.37 LECO Score: +2.48

Top 25 pick

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Member Avatar 42asdf (49.88) Submitted: 3/1/2013 4:55:47 PM : Outperform Start Price: $54.37 LECO Score: +2.48

seems to have a fair price for its earnings and book value (maybe very slightly overpriced), but it has great growth, ROE, and no debt.

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Member Avatar Turbolover (94.22) Submitted: 12/29/2012 11:04:21 PM : Outperform Start Price: $47.14 LECO Score: +11.61

Just read the Motley Fool article about how well LECO treats its employees and how it leads to long term success. I like the low debt and longterm growth. Holding on for a long time.

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Member Avatar cctb4552 (< 20) Submitted: 12/29/2012 5:20:47 PM : Outperform Start Price: $47.14 LECO Score: +11.61

I have been in the industrial business for 15yrs and the only competition that I have seen is from Miller. Lincoln has the market with contractors and industrial businesses from what I have seen. We buy Lincoln all the time...

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Member Avatar jgg91261 (96.47) Submitted: 1/31/2012 9:11:52 PM : Outperform Start Price: $41.58 LECO Score: +24.30

great company

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Member Avatar HunNemo (43.05) Submitted: 8/7/2010 3:13:05 PM : Outperform Start Price: $26.10 LECO Score: +102.18

Fuqua discussion

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Member Avatar TMF10KChallenge (< 20) Submitted: 4/29/2010 4:55:33 PM : Outperform Start Price: $28.69 LECO Score: +88.71

Motley Fool Analyst Development Program- 10KChallenge writeup

Analyst: Bryan Hinmon

Lincoln Electric Holdings, Inc.
Nasdaq: LECO

Market Data
Current Price:   $60.29   
Market Cap:   $2,570 MM
MRY Sales:   $1,729 MM
Sector:      Industrials
Industry:   Industrial Machinery

Business Description
Lincoln Electric has been a Midwestern institution since 1895. The Company is more than just a designer and manufacturer of welding and cutting products – they are “The Welding Experts.” In fact, aside from the fact that the moniker was earned over a century, the slogan is actually trademarked. The core of Lincoln’s business is arc welding. Welding, in general, is the process of fusing two pieces of metal together. Arc welding is a type of welding that gets its name from the path of the electrodes that heat the metals and make them unite. The Company generates about 40 percent of revenue from welding and cutting machinery that ranges from huge industrial grade stuff to personal, do-it-yourselfer, style products. Lincoln is also a pioneer in robotic welding technology. The remaining 60 percent of its business comes from selling consumables that are used up during the welding process. This provides recurring revenue for the Company.

Arc welding is used in numerous applications. Infrastructure (buildings, bridges and rail) and energy (pipelines and offshore E&P) are the predominant applications, though welding is important in the auto and shipbuilding industries too.

Lincoln is the world’s largest manufacturer of consumables and equipment thanks to its long history, pristine reputation and global presence. It has 36 manufacturing facilities in 20 countries and sales offices worldwide. Additionally, Lincoln spends a good deal (relative to competitors) on R&D. A key result of this is the Company’s “Guaranteed Cost Reduction Program.” Under this program, the Company guarantees that the user will achieve cost savings in its manufacturing process when it utilizes Lincoln’s products. With such a guarantee winning new customers is easy.

Competitive Landscape
Threat of Substitutes
The use of steel for infrastructure has no substitutes, and given that forging the steel used to make a skyscraper in one single piece is impossible, welding doesn’t have many substitutes. So long as engineers continue to be concerned with trivial things like structural integrity and safety, welding is pretty well set in place.

Threat of New Entry
Welding is a mature industry undergoing a bit of a revival. Returns are not so attractive that they would entice new entrants. However, the existing competition is excited about the “land grab” that appears set as global infrastructure looks set to grow.

Competitive Rivalry
There are four major players and several smaller, regional players in the welding business. Lincoln is the largest, with 14 percent market share. The Company has grown its market share over the past century and has acquired smaller, weaker folk. Others in the business include Illinois Tool Works, EASB Welding & Cutting and Liquide Welding. The industry continues to be in a state of consolidation.

Power of Buyers
Lincoln has thousands of customers and would not be materially impacted if it lost one, or even a few.

Power of Suppliers
Lincoln uses raw materials that are widely available as inputs to its products. It relies on various chemicals, electronics, steel, engines, brass, copper and aluminum alloys. Most of these are available on the open market.

Long-Term Prospects
Aging and deteriorating infrastructure, combined with the search for new and more efficient energy sources will drive demand for Lincoln’s welding and cutting tools. Operating a mature industry, Lincoln will rely on rock-solid customer relationships to maintain its consumable sales. The industry is likely to continue to consolidate, which given the health of the Company’s balance sheet and still low (but dominant market share), will work to Lincoln’s advantage. I think the long-term prospects are fair but expect Lincoln to fare the best of all its competitors.

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Member Avatar oyramnairb (76.10) Submitted: 3/31/2010 3:35:31 PM : Outperform Start Price: $25.38 LECO Score: +116.31

Solid management and an industry with plenty of growth opportunity.

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Member Avatar PenchyOne (46.69) Submitted: 3/21/2010 9:19:19 PM : Outperform Start Price: $24.74 LECO Score: +121.13

I heard about LECO on NPR last week. What was impressive is the "lifetime job if you perform" policy. It never will layoff a worker anyrime unless they are ineffective and have always paid an average $17000 bonus every year. They were est. in 1895 so I think LECO knows how to navigate recessionwaters. Plus with a great bal. sheet and cash this is a long-term buy hands down. LECO doubled twice since 2000, that is it started at 20 went to 40, then to 80. So I figure on to 160 in the next 3-5 years. Not bad for a boring company, Oh, did I mention they are big in China?

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Member Avatar BeaterOfFools (< 20) Submitted: 3/13/2010 7:50:06 PM : Outperform Start Price: $25.09 LECO Score: +117.04

Red Raider is Lord

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Member Avatar jduncanmason (< 20) Submitted: 11/27/2009 2:13:25 PM : Outperform Start Price: $23.52 LECO Score: +127.37

Infrastructure

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