Lincoln Electric Holdings (LECO) Is Today's Strong And Under The Radar Stock

Trade-Ideas LLC identified Lincoln Electric Holdings (LECO) as a strong and under the radar candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

Lincoln Electric Holdings

(

LECO

) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Lincoln Electric Holdings as such a stock due to the following factors:

  • LECO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $25.6 million.
  • LECO has traded 56 options contracts today.
  • LECO is making at least a new 3-day high.
  • LECO has a PE ratio of 38.
  • LECO is mentioned 0.68 times per day on StockTwits.
  • LECO has not yet been mentioned on StockTwits today.
  • LECO is currently in the upper 20% of its 1-year range.
  • LECO is in the upper 35% of its 20-day range.
  • LECO is in the upper 45% of its 5-day range.
  • LECO is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on LECO:

Lincoln Electric Holdings, Inc., through its subsidiaries, designs, manufactures, and sells welding, cutting, and brazing products in the United States, China, and Internationally. The stock currently has a dividend yield of 2.1%. LECO has a PE ratio of 38. Currently there are 5 analysts that rate Lincoln Electric Holdings a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Lincoln Electric Holdings has been 517,500 shares per day over the past 30 days. Lincoln Electric has a market cap of $4.1 billion and is part of the industrial goods sector and industrial industry. The stock has a beta of 1.05 and a short float of 5.5% with 8.51 days to cover. Shares are up 16.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Lincoln Electric Holdings as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, weak operating cash flow and disappointing return on equity.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.42, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.26, which illustrates the ability to avoid short-term cash problems.
  • 37.17% is the gross profit margin for LINCOLN ELECTRIC HLDGS INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 9.73% is above that of the industry average.
  • LECO, with its decline in revenue, slightly underperformed the industry average of 13.0%. Since the same quarter one year prior, revenues fell by 16.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to $24.36 million or 53.84% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • In its most recent trading session, LECO has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

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