Contrasting Lincoln Electric (LECO) & WSI Industries (WSCI)

Lincoln Electric (NASDAQ:LECO) and WSI Industries (NASDAQ:WSCI) are both industrial products companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, risk, profitability and institutional ownership.

Risk and Volatility

Lincoln Electric has a beta of 1.27, meaning that its stock price is 27% more volatile than the S&P 500. Comparatively, WSI Industries has a beta of 0.16, meaning that its stock price is 84% less volatile than the S&P 500.

Dividends

Lincoln Electric pays an annual dividend of $1.56 per share and has a dividend yield of 1.9%. WSI Industries pays an annual dividend of $0.16 per share and has a dividend yield of 2.3%. Lincoln Electric pays out 41.2% of its earnings in the form of a dividend. Lincoln Electric has increased its dividend for 14 consecutive years.

Analyst Recommendations

This is a summary of recent ratings and target prices for Lincoln Electric and WSI Industries, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lincoln Electric 0 2 7 0 2.78
WSI Industries 0 0 0 0 N/A

Lincoln Electric currently has a consensus target price of $101.50, suggesting a potential upside of 20.49%. Given Lincoln Electric’s higher possible upside, equities research analysts plainly believe Lincoln Electric is more favorable than WSI Industries.

Insider and Institutional Ownership

71.2% of Lincoln Electric shares are owned by institutional investors. Comparatively, 9.1% of WSI Industries shares are owned by institutional investors. 3.3% of Lincoln Electric shares are owned by company insiders. Comparatively, 9.5% of WSI Industries shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Lincoln Electric and WSI Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lincoln Electric 7.40% 31.77% 12.34%
WSI Industries 2.45% 4.03% 2.20%

Valuation & Earnings

This table compares Lincoln Electric and WSI Industries’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Lincoln Electric $2.62 billion 2.07 $247.50 million $3.79 22.23
WSI Industries $34.60 million 0.60 $850,000.00 N/A N/A

Lincoln Electric has higher revenue and earnings than WSI Industries.

Summary

Lincoln Electric beats WSI Industries on 11 of the 15 factors compared between the two stocks.

Lincoln Electric Company Profile

Lincoln Electric Holdings, Inc., through its subsidiaries, designs, manufactures, and sells welding, cutting, and brazing products worldwide. It operates through three segments: Americas Welding, International Welding, and The Harris Products Group. The company's welding products include arc welding power sources, plasma cutters, wire feeding systems, robotic welding packages, integrated automation systems, fume extraction equipment, consumable electrodes, fluxes and welding accessories, and specialty welding consumables and fabrication products. It also provides computer numeric controlled plasma and oxy-fuel cutting systems, and regulators and torches used in oxy-fuel welding, cutting, and brazing; and consumables used in the brazing and soldering alloys market. In addition, the company is involved in the retail business in the United States. It serves general fabrication, energy and process, automotive and transportation, heavy fabrication, and construction and infrastructure industries, as well as ship building and maintenance and repair markets. The company sells its products directly to users of welding products, as well as through industrial distributors, retailers, and agents. Lincoln Electric Holdings, Inc. was founded in 1895 and is headquartered in Cleveland, Ohio.

WSI Industries Company Profile

WSI Industries, Inc. engages in the precision contract metal machining business in the United States. It manufactures metal components in medium to high volumes in accordance with customer specifications. The company serves aerospace/avionics/defense industries, recreational power sports vehicles, markets, energy industry, automotive industry, and bioscience industry. WSI Industries, Inc. was founded in 1950 and is headquartered in Monticello, Minnesota.

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