Lincoln Electric (LECO): The 1 Automation Leader Stock You’ve Overlooked

When most investors think about automation, their minds jump straight to software, AI, or futuristic robotics firms. But some of the biggest automation opportunities are happening in industries that have been around for over a century … and Lincoln Electric (NASDAQ: LECO) is proving it.

In case you missed it, LECO was featured as a Strong Buy in this very newsletter last week. See the story here.

Happily, the price has largely remained flat, meaning this could still potentially be an attractive entry point.

That said, let’s look at what we like about the stock. 

First, the stock is A rated according to our Zen Ratings system. Stocks with an A rating in our system have historically delivered 32.52+% annual returns on average. 

It’s also the highest-rated stock in the Tools & Accessories sector. 

Founded in 1895, Lincoln Electric is the global leader in arc welding products, but over the past decade it has quietly built a powerhouse business in automated welding solutions. 

Welding might not sound high-tech… but this company is turning it into an automation goldmine. These systems (from robotic welding cells to cobots) help manufacturers tackle one of the most pressing challenges in the industry: a shrinking pool of skilled welders.

The problem: Welding is a highly specialized trade, and much of the workforce is nearing retirement age. With fewer young workers entering the field, many manufacturers are facing capacity bottlenecks and rising labor costs.

The solution: LECO’s automated welding technology allows companies to maintain or even expand output without increasing headcount … improving productivity, quality, and safety all at once.

And automation isn’t a side business for Lincoln Electric. The company’s automation segment has been growing faster than its traditional product lines, benefiting from both manufacturing modernization and reshoring trends in North America. With industries from aerospace to heavy equipment to shipbuilding needing reliable, high-quality welds, demand is set to stay strong.

Our ratings reflect not just strong growth potential (LECO scores a B in Growth) but also exceptional financial quality (the stock has an A in its Financial Component Grade). This is important because share price performance tracks earnings growth over the long term.  

Lincoln Electric has a long track record of profitability, disciplined capital allocation, and shareholder returns …. all while continuing to innovate and expand its automation footprint.

The company is also a Strong Buy according to top Wall Street analysts we track:

Click here to see analyst price targets for LECO.

Automation is reshaping manufacturing at an accelerating pace … but you may not need to run out and buy humanoid robot or speculative robotics stocks. LECO is already at the forefront of one of its most critical niches. For investors looking for a way to play the industrial side of automation, with the added tailwind of labor shortages, Lincoln Electric deserves a spot on the watchlist.

Click here to add LECO to your watchlist

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