Lincoln Electric Holdings, Inc. (LECO - Free Report) delivered adjusted earnings of $1.22 per share in second-quarter 2018, which climbed around 26% year over year. The Air Liquide Welding acquisition contributed 5 cents to adjusted earnings per share in the quarter. Earnings, however, missed the Zacks Consensus Estimate of $1.23.
Including one-time items, earnings in the reported quarter came in at $1.04 compared with 92 cents recorded in the prior-year quarter.
Total revenues jumped 26% year over year to $790 million, including a 16% benefit from acquisitions, 4.4% higher volumes, 4.9% increase in price and 0.7% from favorable foreign exchange. The year-over-year sales growth stemmed from strong industrial production trends and order rates. Sales, however, missed the Zacks Consensus Estimate of $793 million.
Costs and Margins
Cost of goods sold escalated 26.6% year over year to $520 million. Gross profit advanced 25% year over year to $270 million. Gross margin contracted 30 basis points (bps) year over year to 34.2%.
Selling, general and administrative expenses flared up 25% to $164 million from $131 million recorded in the year-earlier quarter. Adjusted operating profit rose 18.8% year over year to $107 million in the reported quarter. Operating margin shrunk 60 bps year over year to 6.9%.
Financial Update
Lincoln Electric had cash and cash equivalents of $357 million at the end of the second quarter compared with $327 million recorded at the end of 2017. The company recorded cash flow from operations of $79.8 million in the April-June quarter compared with $75.4 million recorded in the year-earlier quarter.
Share Price Performance
Shares of the company have outperformed the industry, over the past year. The stock has gained around 4% compared with the 1.6% loss recorded by the industry during the same time period.
Zacks Rank & Key Picks
Lincoln Electric currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the same sector include Actuant Corporation , W.W. Grainger, Inc. (GWW - Free Report) and DMC Global Inc. (BOOM - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Actuant has a long-term earnings growth rate of 15.6%. Its shares have rallied around 12%, over the past year.
Grainger has a long-term earnings growth rate of 12.5%. The company’s shares have surged 99% in the past year.
DMC Global has a long-term earnings growth rate of 20%. The company’s shares have appreciated 267% in a year’s time.
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Lincoln Electric Holdings, Inc. (LECO - Free Report) delivered adjusted earnings of $1.22 per share in second-quarter 2018, which climbed around 26% year over year. The Air Liquide Welding acquisition contributed 5 cents to adjusted earnings per share in the quarter. Earnings, however, missed the Zacks Consensus Estimate of $1.23.
Including one-time items, earnings in the reported quarter came in at $1.04 compared with 92 cents recorded in the prior-year quarter.
Total revenues jumped 26% year over year to $790 million, including a 16% benefit from acquisitions, 4.4% higher volumes, 4.9% increase in price and 0.7% from favorable foreign exchange. The year-over-year sales growth stemmed from strong industrial production trends and order rates. Sales, however, missed the Zacks Consensus Estimate of $793 million.
Costs and Margins
Cost of goods sold escalated 26.6% year over year to $520 million. Gross profit advanced 25% year over year to $270 million. Gross margin contracted 30 basis points (bps) year over year to 34.2%.
Selling, general and administrative expenses flared up 25% to $164 million from $131 million recorded in the year-earlier quarter. Adjusted operating profit rose 18.8% year over year to $107 million in the reported quarter. Operating margin shrunk 60 bps year over year to 6.9%.
Financial Update
Lincoln Electric had cash and cash equivalents of $357 million at the end of the second quarter compared with $327 million recorded at the end of 2017. The company recorded cash flow from operations of $79.8 million in the April-June quarter compared with $75.4 million recorded in the year-earlier quarter.
Share Price Performance
Shares of the company have outperformed the industry, over the past year. The stock has gained around 4% compared with the 1.6% loss recorded by the industry during the same time period.
Zacks Rank & Key Picks
Lincoln Electric currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the same sector include Actuant Corporation , W.W. Grainger, Inc. (GWW - Free Report) and DMC Global Inc. (BOOM - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Actuant has a long-term earnings growth rate of 15.6%. Its shares have rallied around 12%, over the past year.
Grainger has a long-term earnings growth rate of 12.5%. The company’s shares have surged 99% in the past year.
DMC Global has a long-term earnings growth rate of 20%. The company’s shares have appreciated 267% in a year’s time.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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