• If you are wondering whether Lincoln Electric Holdings is priced attractively after its recent run, the next sections will walk through what the market might be implying about its value today.
• The stock closed at US$285.82, with returns of 6.7% over 7 days, 13.6% over 30 days, 17.3% year to date, 50.0% over 1 year, 73.4% over 3 years, and 164.9% over 5 years. These figures can change how investors think about both upside potential and risk.
• Recent news coverage has focused on Lincoln Electric's position in welding and automation equipment and how investors are assessing its role in industrial demand and automation trends. This context helps explain why the share price performance has attracted attention from both long term holders and new investors.
• Despite that backdrop, Lincoln Electric currently scores 0 out of 6 on our valuation checks, as shown by its valuation score. Next we will look at how different valuation methods assess the stock and then finish with a way to think about value that goes beyond the numbers alone.

Lincoln Electric Holdings scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Lincoln Electric Holdings Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company could be worth by projecting its future cash flows and discounting them back to today, so you can compare that value with the current share price.

For Lincoln Electric Holdings, the model used is a 2 Stage Free Cash Flow to Equity approach, based on cash flow projections. The latest twelve month free cash flow is about $556.2 million. Analyst inputs and extrapolated figures suggest free cash flow projections such as $607.4 million in 2026 and $640.0 million in 2028, with further estimates running out to 2035 and all expressed in US$.

When all projected cash flows are discounted back, the DCF model arrives at an estimated intrinsic value of about $166.82 per share. Compared with the recent share price of $285.82, this implies that the stock is around 71.3% overvalued using this framework.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Lincoln Electric Holdings may be overvalued by 71.3%. Discover 868 undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Lincoln Electric Holdings Price vs Earnings

For a profitable company, the P/E ratio is a useful way to look at value because it tells you how much you are paying for each dollar of current earnings. The higher the expected growth and the lower the perceived risk, the higher the P/E that investors may be comfortable paying, while slower growth or higher risk usually point to a lower “normal” multiple.

Lincoln Electric currently trades on a P/E of 29.97x. That sits above the Machinery industry average of 28.22x and the peer group average of 27.84x, so the stock is priced at a higher multiple than many of its listed peers.

Simply Wall St’s Fair Ratio for Lincoln Electric is 26.82x. This is a proprietary estimate of what a P/E might look like for the company once you factor in elements such as its earnings growth profile, profit margins, industry, market cap and specific risks. Because it adjusts for these company level traits, the Fair Ratio can offer a more tailored reference point than a simple comparison with broad industry or peer averages. Set against the actual P/E of 29.97x, the shares look overvalued on this metric.

Result: OVERVALUED

P/E ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1426 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Lincoln Electric Holdings Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, a simple way to connect your view of a company with the numbers behind it.

A Narrative is your story for a stock, where you spell out how you see its future revenue, earnings and margins, then link that view to a forecast and your own fair value estimate. Instead of only reacting to ratios like P/E, you are tying Lincoln Electric’s business story to concrete assumptions and a price that makes sense to you.

On Simply Wall St’s Community page, millions of investors use Narratives as an accessible tool to compare their fair value with the current share price. This can help them decide whether a stock looks closer to a buy, a hold, or a sell for their situation.

Narratives also update automatically when fresh information such as news or earnings is added. For Lincoln Electric that could mean one investor’s Narrative supports a much higher fair value than today’s price, while another investor’s Narrative points to a much lower figure, based on different expectations and risk views.

Do you think there's more to the story for Lincoln Electric Holdings? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.