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Lincoln Electric shares rose 8% as Q2 adjusted EPS beat estimates and revenues hit a record $1.22B.
Organic sales grew 10.1%, driven by 7.7% pricing and 2.4% volume growth.
LECO raised 2026 sales growth guidance to the low-double-digit range after record cash flow.
Lincoln Electric Holdings, Inc. (LECO - Free Report) shares have gained 8% since it reported second-quarter 2026 results on July 30. Adjusted earnings came in at $2.93 per share, up 12.7% year over year. The figure surpassed the Zacks Consensus Estimate of $2.81 by 4.27%.
Including one-time items, the bottom line was $2.88 per share compared with $2.56 in the year-ago quarter.
LECO's Sales Mix Benefits From Price and Volume
Revenues increased 12% to a record $1.22 billion and beat the consensus estimate of $1.17 billion by 4.45%. Results benefited from 10.1% organic sales growth, with volumes contributing 2.4% and pricing at 7.7%. Acquisitions contributed 1.5%, primarily reflecting the Alloy Steel acquisition, and favorable foreign currency translation added 0.4%.
Lincoln Electric Holdings, Inc. Price, Consensus and EPS Surprise
Consumables sales increased in the low-teens percentage range, equipment sales rose by a high-single-digit percentage and automation sales advanced by a mid-single-digit percentage. Four of the company’s five major end markets grew, led by a mid-30% increase in general fabrication. However, transportation declined by a mid-single-digit percentage.
Lincoln Electric's Margin Performance Improves
The cost of goods sold increased 12.8% year over year to $770.7 million. Gross profit rose 10.7% to $449 million, while the gross margin contracted 50 basis points to 36.8%.
Selling, general and administrative expenses increased 6.6% to $224.9 million. However, SG&A expenses, as a percentage of sales, declined 100 basis points to 18.4%.
Adjusted operating income climbed 14.9% to $224.1 million, with the adjusted operating margin expanding 50 basis points to a record 18.4%.
LECO's Americas Welding Business Gains Momentum
Americas Welding revenues increased 11.2% year over year to $774.4 million. Volume growth of 7.1% reflected gains across all product areas, led by accelerated capital spending. Pricing contributed 3.7%, while currency movements provided a 0.4% benefit. We expected the segment’s net sales to be $754 million in the quarter.
Adjusted EBIT rose 14.6% to $158.1 million. The segment’s adjusted EBIT margin improved 110 basis points to 19.7%, aided by operating leverage from higher volumes and a narrower price-cost headwind. Tariff refunds also supported profitability. Our prediction for the segment’s adjusted operating income was $148 million.
Lincoln Electric's International Results Face Volume Pressure
International Welding sales rose 4.5% to $243.3 million, as a 7% acquisition contribution and modest pricing and currency benefits offset a 4.7% volume decline. Organic sales were hurt by slowing demand in Europe, the Middle East and Africa, including a $2 million impact from the Middle East conflict. We expected the segment’s net sales to be $236 million in the quarter.
Adjusted EBIT declined 12.9% to $26.6 million, while the adjusted EBIT margin contracted 210 basis points to 10.6%. Lower EMEA volumes weighed on the segment’s profitability despite growth in Asia Pacific and contributions from Alloy Steel. We predicted an adjusted operating profit of $28.8 million.
LECO's Harris Products Group Delivers Sales & Profit Growth
The Harris Products Group’s sales increased 26.9% to $201.9 million. A 34.2% pricing benefit, reflecting higher year-over-year metal costs, primarily silver, more than offset an 8.2% volume decline. Volumes were down 8.2% as it faced difficult year-over-year comparisons in HVAC and the retail channel. Our projection for the segment’s net sales was $171 million.
Adjusted EBIT advanced 32.5% to $42.3 million. The adjusted EBIT margin expanded 100 basis points to 20.4%, supported by SG&A leverage and a tariff refund. Our prediction for the segment’s adjusted operating income was $34.3 million.
Lincoln Electric Generates Record Cash Flow
Cash flow from operations reached a record $253.8 million, up from $143.8 million a year earlier. Free cash flow totaled $222.3 million, resulting in cash conversion of 138%.
LECO returned $120 million to shareholders, including $43.4 million in dividends and $76.1 million in share repurchases. Cash and cash equivalents were $242.4 million at quarter-end, while total debt declined to $1.15 billion from $1.29 billion at the end of 2025.
LECO Raises Its 2026 Sales Assumption
Lincoln Electric raised its 2026 net sales growth assumption to the low-double-digit percentage range from the high-single-digit range. Management expects one-third of organic growth to come from volume and two-thirds from pricing.
The company anticipates neutral price-cost conditions and a mid-20% incremental adjusted operating margin in the second half. It also projects capital expenditures of $110-$130 million, a low-to-mid-20% tax rate and full-year cash conversion of 100% for the full year.
LECO Stock’s Price Performance
Lincoln Electric’s shares have gained 14.7% in the past year compared with the industry’s 12.3% growth.
Quarterly Performances of Other Manufacturing Stocks
Stanley Black & Decker, Inc. (SWK - Free Report) reported adjusted earnings of $1.57 per share for the second quarter of 2026, which beat the Zacks Consensus Estimate of $1.20 by 30.8%. The bottom line increased from adjusted earnings of $1.08 per share reported in the year-ago quarter.
Stanley Black & Decker’s net sales of $3.96 billion surpassed the consensus estimate of $3.93 billion by 0.7% and increased 0.4% year over year. Higher organic sales, improved gross margins and strong cash generation supported the quarter. Stanley Black & Decker’s also raised its full-year adjusted earnings guidance to $5.20-$5.80 per share, up from the earlier outlook of $4.90-$5.70.
Enerpac (EPAC - Free Report) came out with quarterly earnings of 60 cents per share in the third quarter of fiscal 2026 (ended May 31, 2026), beating the Zacks Consensus Estimate of 49 cents per share. This compares with earnings of 51 cents per share a year ago.
Enerpac posted revenues of $167.6 million for the quarter, surpassing the Zacks Consensus Estimate of $165 million. This marks a 6% increase from year-ago revenues of $158.7 million. Enerpac updated its earnings per share projection for fiscal 2026 to $1.84-$1.89 from the prior stated $1.85-$1.92.
Dover Corporation (DOV - Free Report) reported second-quarter 2026 adjusted earnings of $2.74 per share, up 12% year over year and beating the Zacks Consensus Estimate of $2.72. The improvement reflected broad-based revenue growth, stronger segmental margins and operational execution that more than offset input-cost inflation.
Dover’s revenues rose 7% year over year to $2.19 billion but missed the consensus estimate of $2.21 billion. Organic revenues increased 4.8% in the quarter.
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LECO Q2 Earnings Beat on Organic Sales Growth, Stock Jumps 8%
Key Takeaways
Lincoln Electric Holdings, Inc. (LECO - Free Report) shares have gained 8% since it reported second-quarter 2026 results on July 30. Adjusted earnings came in at $2.93 per share, up 12.7% year over year. The figure surpassed the Zacks Consensus Estimate of $2.81 by 4.27%.
Including one-time items, the bottom line was $2.88 per share compared with $2.56 in the year-ago quarter.
LECO's Sales Mix Benefits From Price and Volume
Revenues increased 12% to a record $1.22 billion and beat the consensus estimate of $1.17 billion by 4.45%. Results benefited from 10.1% organic sales growth, with volumes contributing 2.4% and pricing at 7.7%. Acquisitions contributed 1.5%, primarily reflecting the Alloy Steel acquisition, and favorable foreign currency translation added 0.4%.
Lincoln Electric Holdings, Inc. Price, Consensus and EPS Surprise
Lincoln Electric Holdings, Inc. price-consensus-eps-surprise-chart | Lincoln Electric Holdings, Inc. Quote
Consumables sales increased in the low-teens percentage range, equipment sales rose by a high-single-digit percentage and automation sales advanced by a mid-single-digit percentage. Four of the company’s five major end markets grew, led by a mid-30% increase in general fabrication. However, transportation declined by a mid-single-digit percentage.
Lincoln Electric's Margin Performance Improves
The cost of goods sold increased 12.8% year over year to $770.7 million. Gross profit rose 10.7% to $449 million, while the gross margin contracted 50 basis points to 36.8%.
Selling, general and administrative expenses increased 6.6% to $224.9 million. However, SG&A expenses, as a percentage of sales, declined 100 basis points to 18.4%.
Adjusted operating income climbed 14.9% to $224.1 million, with the adjusted operating margin expanding 50 basis points to a record 18.4%.
LECO's Americas Welding Business Gains Momentum
Americas Welding revenues increased 11.2% year over year to $774.4 million. Volume growth of 7.1% reflected gains across all product areas, led by accelerated capital spending. Pricing contributed 3.7%, while currency movements provided a 0.4% benefit. We expected the segment’s net sales to be $754 million in the quarter.
Adjusted EBIT rose 14.6% to $158.1 million. The segment’s adjusted EBIT margin improved 110 basis points to 19.7%, aided by operating leverage from higher volumes and a narrower price-cost headwind. Tariff refunds also supported profitability. Our prediction for the segment’s adjusted operating income was $148 million.
Lincoln Electric's International Results Face Volume Pressure
International Welding sales rose 4.5% to $243.3 million, as a 7% acquisition contribution and modest pricing and currency benefits offset a 4.7% volume decline. Organic sales were hurt by slowing demand in Europe, the Middle East and Africa, including a $2 million impact from the Middle East conflict. We expected the segment’s net sales to be $236 million in the quarter.
Adjusted EBIT declined 12.9% to $26.6 million, while the adjusted EBIT margin contracted 210 basis points to 10.6%. Lower EMEA volumes weighed on the segment’s profitability despite growth in Asia Pacific and contributions from Alloy Steel. We predicted an adjusted operating profit of $28.8 million.
LECO's Harris Products Group Delivers Sales & Profit Growth
The Harris Products Group’s sales increased 26.9% to $201.9 million. A 34.2% pricing benefit, reflecting higher year-over-year metal costs, primarily silver, more than offset an 8.2% volume decline. Volumes were down 8.2% as it faced difficult year-over-year comparisons in HVAC and the retail channel. Our projection for the segment’s net sales was $171 million.
Adjusted EBIT advanced 32.5% to $42.3 million. The adjusted EBIT margin expanded 100 basis points to 20.4%, supported by SG&A leverage and a tariff refund. Our prediction for the segment’s adjusted operating income was $34.3 million.
Lincoln Electric Generates Record Cash Flow
Cash flow from operations reached a record $253.8 million, up from $143.8 million a year earlier. Free cash flow totaled $222.3 million, resulting in cash conversion of 138%.
LECO returned $120 million to shareholders, including $43.4 million in dividends and $76.1 million in share repurchases. Cash and cash equivalents were $242.4 million at quarter-end, while total debt declined to $1.15 billion from $1.29 billion at the end of 2025.
LECO Raises Its 2026 Sales Assumption
Lincoln Electric raised its 2026 net sales growth assumption to the low-double-digit percentage range from the high-single-digit range. Management expects one-third of organic growth to come from volume and two-thirds from pricing.
The company anticipates neutral price-cost conditions and a mid-20% incremental adjusted operating margin in the second half. It also projects capital expenditures of $110-$130 million, a low-to-mid-20% tax rate and full-year cash conversion of 100% for the full year.
LECO Stock’s Price Performance
Lincoln Electric’s shares have gained 14.7% in the past year compared with the industry’s 12.3% growth.
Image Source: Zacks Investment Research
Lincoln Electric’s Zacks Rank
LECO currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quarterly Performances of Other Manufacturing Stocks
Stanley Black & Decker, Inc. (SWK - Free Report) reported adjusted earnings of $1.57 per share for the second quarter of 2026, which beat the Zacks Consensus Estimate of $1.20 by 30.8%. The bottom line increased from adjusted earnings of $1.08 per share reported in the year-ago quarter.
Stanley Black & Decker’s net sales of $3.96 billion surpassed the consensus estimate of $3.93 billion by 0.7% and increased 0.4% year over year. Higher organic sales, improved gross margins and strong cash generation supported the quarter. Stanley Black & Decker’s also raised its full-year adjusted earnings guidance to $5.20-$5.80 per share, up from the earlier outlook of $4.90-$5.70.
Enerpac (EPAC - Free Report) came out with quarterly earnings of 60 cents per share in the third quarter of fiscal 2026 (ended May 31, 2026), beating the Zacks Consensus Estimate of 49 cents per share. This compares with earnings of 51 cents per share a year ago.
Enerpac posted revenues of $167.6 million for the quarter, surpassing the Zacks Consensus Estimate of $165 million. This marks a 6% increase from year-ago revenues of $158.7 million. Enerpac updated its earnings per share projection for fiscal 2026 to $1.84-$1.89 from the prior stated $1.85-$1.92.
Dover Corporation (DOV - Free Report) reported second-quarter 2026 adjusted earnings of $2.74 per share, up 12% year over year and beating the Zacks Consensus Estimate of $2.72. The improvement reflected broad-based revenue growth, stronger segmental margins and operational execution that more than offset input-cost inflation.
Dover’s revenues rose 7% year over year to $2.19 billion but missed the consensus estimate of $2.21 billion. Organic revenues increased 4.8% in the quarter.