LECO
Lincoln Electric Holdings, Inc.
$263.43
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Overvalued
Trading 3.3% above fair value
You pay
$263.43
Bear
$168.48
Fair
$255.13
Bull
$346.29
Bear
$168.48
-36.0%
8% stage 1 growth, 11% discount
Fair
$255.13
-3.2%
13% stage 1 growth, 11% discount
Bull
$346.29
+31.5%
17% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (13% base case)
Terminal Value % of EV
41%
Implied Market Multiple
28.9x
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 $301.71 from 22 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $255.13 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