LECO
Lincoln Electric Holdings, Inc.
$252.74
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 1.0% above fair value
You pay
$252.74
Bear
$165.08
Fair
$250.22
Bull
$339.81
Bear
$165.08
-34.7%
8% stage 1 growth, 11% discount
Fair
$250.22
-1.0%
13% stage 1 growth, 11% discount
Bull
$339.81
+34.5%
17% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
28.6x
Market is pricing in (growth)
13.8%
vs 12.7% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $304.00 from 22 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $250.22 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions