Analyst Note
| Krzysztof Smalec, CFA |Narrow-moat-rated Lincoln Electric ended 2020 in strong fashion, as its fourth-quarter adjusted EPS of $1.24 easily beat the FactSet consensus estimate of $1.06. Despite a 5.8% year-over-year net sales decline, Lincoln Electric increased its fourth-quarter adjusted EPS 7.8% from the prior-year period thanks to 100-basis-points of operating margin expansion. After rolling our model forward one year, we are raising our fair value estimate for Lincoln Electric to $107 from $94, which reflects the firm’s solid execution, an improving end market outlook, and time value of money.