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

Insider & Institutional Ownership

9.1% of WSI Industries shares are held by institutional investors. Comparatively, 71.2% of Lincoln Electric shares are held by institutional investors. 9.5% of WSI Industries shares are held by insiders. Comparatively, 3.3% of Lincoln Electric shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

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

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
WSI Industries $34.60 million 0.60 $850,000.00 N/A N/A
Lincoln Electric $2.62 billion 2.08 $247.50 million $3.79 22.36

Lincoln Electric has higher revenue and earnings than WSI Industries.

Profitability

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

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

Dividends

WSI Industries pays an annual dividend of $0.16 per share and has a dividend yield of 2.3%. Lincoln Electric pays an annual dividend of $1.56 per share and has a dividend yield of 1.8%. 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.

Volatility & Risk

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

Analyst Ratings

This is a breakdown of recent ratings for WSI Industries and Lincoln Electric, as provided by MarketBeat.

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

Lincoln Electric has a consensus price target of $101.50, suggesting a potential upside of 19.76%. Given Lincoln Electric’s higher possible upside, analysts plainly believe Lincoln Electric is more favorable than WSI Industries.

Summary

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

About WSI Industries

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.

About Lincoln Electric

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.

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