# Esab (ESAB.US)

Canonical: https://gigainvestors.com/s/ESAB

Analysis as of: 2026-10-16T07:28:20.699Z. Financial observations: FY2019–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $65.63 per share; close as of 2026-10-15.

Estimated value: low $53.33 per share, central $60.34 per share, high $69.66 per share. Buy at or below the central value $60.34 per share. Valuation as of 2026-10-16T07:28:20.699Z; scenarios are not confidence intervals.

Expected annual return: 9.4% at the stated quote. About 9.4% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 2 revenue declines in the last 10 years (informational)

- Financial history: 8 years

- Years with declining revenue: 2

- Years with a net loss: 0

- Operating margin variation: 0.16×

Chart: Operating margin; fiscal year observations.

- FY2019: 0.11×

- FY2020: 0.10×

- FY2021: 0.13×

- FY2022: 0.13×

- FY2023: 0.15×

- FY2024: 0.16×

- FY2025: 0.17×

- LTM to Jun 2026: 0.15×

### moat: pass

- ROIC, median of available years: 23.4%

- ROIC, second-lowest year: 17.8%

- Typical minus recent gross margin: -0.2 pp

- Typical gross margin (annual median): 35.5%

- Recent gross margin (lower of latest and 3-year median): 35.7%

- Years with nonpositive capital: 0

- Capital spending / revenue: 1.8%

- ROIC including acquisitions, ten-year median: 8.5%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2019: 19.0%

- FY2020: 15.7%

- FY2021: 23.0%

- FY2022: 23.8%

- FY2023: 27.3%

- FY2024: 34.3%

- FY2025: 26.5%

- LTM to Jun 2026: 17.8%

### economics: pass

- Owner earnings / net income, 5-yr: 1.12×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $1.2B

- Net income, five-year total: $1.1B

- Return on incremental invested capital: 374.8%

- Working capital / revenue, annual change: 0.1 pp

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.12×

- FY2023: 1.10×

- FY2024: 1.06×

- FY2025: 1.16×

- LTM to Jun 2026: 1.21×

### management: pass

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 19.0% vs 27.3%

- Per-share earnings: 2.88 to 3.70 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 5-year annual growth: 0.4%

- Diluted shares, 5-year annual growth: 0.4%

- Per-share value growth: 6.5%

- Per-share value change: $0.82

- Per-share value, starting three-year median: $2.88

- Per-share value, ending three-year median: $3.70

- Average buyback yield: 0.1%

- Buyback history: 1 years

- Debt-funded buybacks: No

- ROIC, first three-year median: 19.0%

- ROIC, last three-year median: 27.3%

Chart: Earnings per share; fiscal year observations.

- FY2019: $2.88

- FY2020: $2.62

- FY2021: $3.92

- FY2022: $3.72

- FY2023: $3.38

- FY2024: $4.33

- FY2025: $3.70

### accounting: pass

- Sloan accruals: -0.7%

- Receivables to sales index (DSRI): 1.18×

- Restructuring years, last five: 1

- Stock compensation / operating cash flow: 6.5%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.15×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 1.21×

Chart: Sloan accruals; fiscal year observations.

- FY2019: -2.2%

- FY2020: -4.5%

- FY2021: -0.5%

- FY2022: 0.3%

- FY2023: -3.3%

- FY2024: -2.2%

- FY2025: -0.7%

## Holders

## Price story

Down 51% since Jul 2025 · "However, ongoing tariff impacts and increased investments in sales initiatives weighed on operating margins." (finance.yahoo.com, Nov 2025) · sales +5.6%

Story as of 2026-10-16T09:58:42.642Z; price observation 2026-10-15.

Price needs cash profits to grow 2% a year for ten years

- 2025-05-14: ESAB Q1 Earnings Call: Outperformance Driven by Equipment Mix and Gas Control Momentum ([finance.yahoo.com](https://finance.yahoo.com/news/esab-q1-earnings-call-outperformance-221518498.html))

- 2025-10-30: ESAB Q3 Deep Dive: Margin Pressures Offset Organic Growth and New Acquisitions ([finance.yahoo.com](https://finance.yahoo.com/news/esab-q3-deep-dive-margin-053524835.html))

### Sales · FY2025–2026

sales +5.6%; source https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm; observed 2026-02-20.

- FY2019: $2.2B 

- FY2020: $2.0B 

- FY2021: $2.4B 

- FY2022: $2.6B 

- FY2023: $2.8B 

- FY2024: $2.7B 

- FY2025: $2.8B 

- FY2026: $3.0B 

### Gross margin · FY2026

gross margin 35.7%; source https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm; observed 2026-02-20.

- FY2019: 35.4% 

- FY2020: 35.0% 

- FY2021: 34.5% 

- FY2022: 34.1% 

- FY2023: 36.6% 

- FY2024: 37.9% 

- FY2025: 35.5% 

- FY2026: 35.7% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in metal fabrication; annual sales are USD 2.8 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm (filed 2026-02-20); FY2025: revenue 2842555000; grossProfit 1010242000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 35.5% to 37.9% during 2023–25; it earns 23.4% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: grossProfit / revenue = 36.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: grossProfit / revenue = 37.9%.

- Source: https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm (filed 2026-02-20); FY2025: grossProfit / revenue = 35.5%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); 8-year return on capital observations [[2019,0.18984643871351917],[2020,0.15742013826063764],[2021,0.23002057745140284],[2022,0.2384973583370543],[2023,0.2734752277302706],[2024,0.34340465722120794],[2025,0.26519486337139075],[2026,0.17828340621953578]]; median 0.23425896789422856. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 7 of 7 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2019: growth capex 0; upkeep 44454000; owner earnings 205054000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2020: growth capex 0; upkeep 40138000; owner earnings 191976000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2021: growth capex 0; upkeep 35584000; owner earnings 274126000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2022: growth capex 0; upkeep 40243000; owner earnings 249482000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: growth capex 0; upkeep 48178000; owner earnings 226807000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: growth capex 0; upkeep 51779000; owner earnings 279852999. Growth capex / owner earnings = 0.

- Source: https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm (filed 2026-02-20); FY2025: growth capex 0; upkeep 47287000; owner earnings 263584000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Dividend observations: [[2019,6054000],[2020,6054000],[2021,6054000],[2022,6054000],[2023,13342000],[2024,16992000],[2025,21913000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 6.5% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); ESAB.US SharesStats.PercentInsiders = 6.493 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 2% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Ten-year compound average after fade. Initial solved rate 0.015608979942712486. Price 65.63; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03.  Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2022-03: $50.00 per share

- 2022-04: $47.00 per share

- 2022-05: $50.00 per share

- 2022-06: $43.75 per share

- 2022-07: $41.22 per share

- 2022-08: $41.09 per share

- 2022-09: $33.36 per share

- 2022-10: $37.30 per share

- 2022-11: $47.34 per share

- 2022-12: $46.92 per share

- 2023-01: $57.81 per share

- 2023-02: $58.65 per share

- 2023-03: $59.07 per share

- 2023-04: $58.36 per share

- 2023-05: $58.72 per share

- 2023-06: $66.54 per share

- 2023-07: $68.70 per share

- 2023-08: $72.17 per share

- 2023-09: $70.22 per share

- 2023-10: $63.30 per share

- 2023-11: $77.15 per share

- 2023-12: $86.62 per share

- 2024-01: $85.99 per share

- 2024-02: $99.12 per share

- 2024-03: $110.57 per share

- 2024-04: $105.88 per share

- 2024-05: $102.82 per share

- 2024-06: $94.43 per share

- 2024-07: $101.60 per share

- 2024-08: $104.97 per share

- 2024-09: $106.31 per share

- 2024-10: $123.04 per share

- 2024-11: $129.08 per share

- 2024-12: $119.94 per share

- 2025-01: $123.84 per share

- 2025-02: $125.30 per share

- 2025-03: $116.50 per share

- 2025-04: $120.12 per share

- 2025-05: $122.99 per share

- 2025-06: $120.55 per share

- 2025-07: $134.17 per share

- 2025-08: $115.37 per share

- 2025-09: $111.74 per share

- 2025-10: $116.82 per share

- 2025-11: $112.24 per share

- 2025-12: $111.72 per share

- 2026-01: $121.10 per share

- 2026-02: $126.17 per share

- 2026-03: $96.66 per share

- 2026-04: $98.27 per share

- 2026-05: $92.43 per share

- 2026-06: $98.63 per share

- 2026-07: $86.53 per share

- 2026-08: $75.38 per share

- 2026-09: $65.88 per share

- 2026-10: $65.63 per share

## Annual estimated value (USD per share)

- FY2023: low $48.87 per share, central $55.50 per share, high $64.33 per share

- FY2024: low $51.45 per share, central $58.11 per share, high $66.96 per share

- FY2025: low $50.89 per share, central $57.62 per share, high $66.57 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1877322/000187732226000007/esab-20251231.htm); period 2025-12-31, filed 2026-02-20.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.