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

Analyst Recommendations

This is a summary of current recommendations and price targets for Lincoln Electric and P & F Industries, as provided by MarketBeat.

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

Lincoln Electric presently has a consensus price target of $101.50, suggesting a potential upside of 20.93%. Given Lincoln Electric’s higher possible upside, research analysts plainly believe Lincoln Electric is more favorable than P & F Industries.

Valuation & Earnings

This table compares Lincoln Electric and P & F 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 2.06 $247.50 million $3.79 22.15
P & F Industries $58.97 million 0.49 -$880,000.00 N/A N/A

Lincoln Electric has higher revenue and earnings than P & F Industries.

Profitability

This table compares Lincoln Electric and P & F 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%
P & F Industries 0.10% 1.51% 1.24%

Volatility & Risk

Lincoln Electric has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500. Comparatively, P & F Industries has a beta of -0.1, indicating that its stock price is 110% 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%. P & F Industries pays an annual dividend of $0.20 per share and has a dividend yield of 2.6%. 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.

Insider & Institutional Ownership

71.2% of Lincoln Electric shares are held by institutional investors. Comparatively, 13.8% of P & F Industries shares are held by institutional investors. 3.0% of Lincoln Electric shares are held by insiders. Comparatively, 39.6% of P & F Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Lincoln Electric beats P & F 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.

P & F Industries Company Profile

P&F Industries, Inc., through its subsidiaries, manufactures, imports, and sells air-powered tools and accessories primarily to the retail, industrial, and automotive markets in the United States and internationally. The company designs, imports, and sells pneumatic hand tools, including sanders, grinders, drills, saws, and impact wrenches under the Florida Pneumatic, Universal Tool, AIRCAT, and NITROCAT names through in-house sales personnel and manufacturers' representatives to retailers, distributors, and private label customers. It also markets pipes and bolt dies, pipe taps, wrenches, vises and stands, pipes and tubing cutting equipment, hydrostatic test pumps, and replacement electrical components for pipe cutting and threading machines through industrial distributors and contractors, as well as assembles and markets a line of compressor air filters. In addition, the company designs, manufactures, and distributes industrial pneumatic tools, such as heavy duty air tools, industrial grinders, impact sockets, hydro-pneumatic riveters, and air motors and custom gears; and industrial gears, hydrostatic test plugs, and various parts for use in power generation, petrochemical, construction, railroad, mining, ship building, and fabricated metals industries under the ATP ATSCO, OZAT, Numatx, Thaxton, and Quality Gear brands, as well as manufactures components, assemblies, and finished product and systems for various original equipment manufacturers. P&F Industries, Inc. was founded in 1959 and is based in Melville, New York.

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