"The real strength in this quarter was profitability. Adjusted operating margin improved to 17.4%, up from prior-year levels, while adjusted net income climbed 21.71% year over year to $137.2 million. That margin expansion is meaningful. Operating cash flow surged 18.82% to $236.7 million, marking a record for the company. Free cash flow reached $205.1 million, giving management real ammunition for capital returns."
"The caveat is revenue. While the $1.06 billion beat came through, organic growth of 5.6% trails the company's recent trajectory. Acquisitions contributed 1.7% of the 7.9% year-over-year growth, meaning core business momentum is decelerating. That's the tension investors are wrestling with right now. Margins are expanding, but the top line isn't accelerating the way it was earlier in the year."
Lincoln Electric reported adjusted EPS of $2.47 versus $2.42 expected and revenue of $1.06 billion versus a $1.05 billion estimate. The company generated record operating cash flow of $236.7 million and free cash flow of $205.1 million, and raised its dividend. Adjusted operating margin improved to 17.4% and adjusted net income rose 21.71% year over year to $137.2 million. Shares initially declined at the open before recovering to mild gains by mid-day. Organic revenue grew 5.6%, with acquisitions adding 1.7% for total 7.9% year-over-year growth, indicating decelerating core momentum.
Read at 24/7 Wall St.
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