ESAB (NYSE:ESAB) Announces Quarterly Earnings Results

ESAB (NYSE:ESAB) released its quarterly earnings data on Thursday. The company reported $1.33 EPS for the quarter, missing the consensus estimate of $1.37 by ($0.04), Zacks reports. ESAB had a net margin of 5.75% and a return on equity of 14.48%. The company had revenue of $807.63 million for the quarter, compared to the consensus estimate of $749.05 million. During the same period last year, the company earned $1.36 EPS. The firm’s revenue for the quarter was up 12.9% on a year-over-year basis. ESAB updated its FY 2026 guidance to 5.400-5.500 EPS.

Here are the key takeaways from ESAB’s conference call:

• Strong second-quarter performance: Sales rose 13% year over year to $766 million, including 2.5% organic growth, while Adjusted EBITDA increased 8% to a record $150 million. Both the Americas and EMEA/APAC segments returned to organic growth.
• Eddyfi acquisition closed ahead of schedule and is expected to add approximately nine percentage points of sales growth in 2026. Management highlighted Eddyfi’s roughly 65% gross margin, 30% EBITDA margin, and potential for workflow-related revenue synergies.
• ESAB raised its 2026 outlook to approximately $3.0 billion-$3.1 billion in core sales and $615 million-$625 million in Adjusted EBITDA, with adjusted EPS guided to $5.40-$5.50 and free-cash-flow conversion near 90%.
• Second-quarter Adjusted EBITDA margin declined 90 basis points to 19.5% due to logistics and commodity inflation, along with targeted commercial investments in equipment. Management expects about $15 million of price-cost headwinds for the full year, although it anticipates gradual improvement in pricing.
• Management expects organic growth to remain flat to slightly better sequentially in the second half, supported by equipment, automation, defense, and general fabrication, while consumables growth is expected to remain in the low single digits. Middle East operations, representing roughly 7%-8% of sales, were down double digits amid conflict-related disruption, though potential reconstruction demand could provide a future tailwind.

ESAB Trading Down 2.4%

Shares of ESAB traded down $2.27 during mid-day trading on Friday, reaching $92.24. 501,215 shares of the company’s stock traded hands, compared to its average volume of 601,778. The company has a debt-to-equity ratio of 0.99, a current ratio of 1.96 and a quick ratio of 2.26. The stock’s 50-day moving average is $91.83 and its two-hundred day moving average is $102.27. ESAB has a 12 month low of $82.18 and a 12 month high of $137.42. The stock has a market cap of $5.62 billion, a P/E ratio of 33.06, a P/E/G ratio of 1.85 and a beta of 1.19.

Hedge Funds Weigh In On ESAB

Large investors have recently bought and sold shares of the business. Los Angeles Capital Management LLC bought a new stake in shares of ESAB during the fourth quarter worth $33,000. Northwestern Mutual Wealth Management Co. grew its holdings in shares of ESAB by 109.4% in the second quarter. Northwestern Mutual Wealth Management Co. now owns 333 shares of the company’s stock worth $40,000 after purchasing an additional 174 shares during the last quarter. Smartleaf Asset Management LLC increased its stake in ESAB by 259.4% in the 4th quarter. Smartleaf Asset Management LLC now owns 381 shares of the company’s stock worth $43,000 after buying an additional 275 shares during the period. Global Retirement Partners LLC increased its stake in ESAB by 3,023.1% in the 4th quarter. Global Retirement Partners LLC now owns 406 shares of the company’s stock worth $45,000 after buying an additional 393 shares during the period. Finally, UMB Bank n.a. lifted its holdings in ESAB by 185.3% during the 4th quarter. UMB Bank n.a. now owns 642 shares of the company’s stock valued at $72,000 after buying an additional 417 shares in the last quarter. Hedge funds and other institutional investors own 91.13% of the company’s stock.

Key Headlines Impacting ESAB

Here are the key news stories impacting ESAB this week:

• Positive Sentiment: Second-quarter revenue rose 12.9% year over year to $807.6 million, substantially exceeding analysts’ $749.1 million estimate. The company highlighted strength in its equipment business and continued operational improvements. ESAB Corporation Announces Second Quarter 2026 Results
• Positive Sentiment: ESAB said the Eddyfi acquisition is closing ahead of schedule, supporting its strategy to expand into inspection and testing markets. Management also forecast 2026 core sales of approximately $3.0 billion to $3.1 billion. ESAB forecasts 2026 core sales and adjusted EPS
• Neutral Sentiment: Management’s earnings call emphasized equipment-market momentum and Eddyfi integration as drivers of a strategic shift, but investors will likely look for evidence that the acquisition produces the expected growth and synergies. ESAB Q2 deep dive
• Negative Sentiment: Adjusted earnings were $1.33 per share, below the $1.37 consensus estimate and down from $1.36 a year earlier. ESAB Q2 Earnings Lag Estimates
• Negative Sentiment: ESAB’s 2026 adjusted EPS guidance of $5.40–$5.50 is below the approximately $5.77 analyst consensus, creating a concern that integration costs, business conditions, or other pressures could limit near-term earnings growth. ESAB Q2 2026 Earnings Call Transcript

Analyst Ratings Changes

ESAB has been the subject of a number of recent research reports. Stifel Nicolaus cut their target price on shares of ESAB from $141.00 to $137.00 and set a “buy” rating for the company in a report on Monday, July 20th. DA Davidson assumed coverage on shares of ESAB in a research report on Monday, June 15th. They set a “buy” rating and a $130.00 price objective for the company. Oppenheimer dropped their price objective on shares of ESAB from $140.00 to $135.00 and set an “outperform” rating for the company in a research note on Tuesday, July 21st. Roth Capital boosted their target price on shares of ESAB from $142.00 to $151.00 and gave the stock a “buy” rating in a report on Tuesday, July 7th. Finally, Weiss Ratings restated a “hold (c)” rating on shares of ESAB in a research report on Friday, July 24th. Eight analysts have rated the stock with a Buy rating and two have given a Hold rating to the company. Based on data from MarketBeat.com, ESAB has a consensus rating of “Moderate Buy” and an average price target of $138.38.

ESAB Company Profile

ESAB Corporation is a global leader in welding, cutting and gas control technologies, offering a comprehensive portfolio of equipment, consumables and automation solutions. The company’s products include welding power sources, cutting machines, torches, electrodes, filler metals and gas regulating equipment designed to meet the needs of diverse industries. ESAB serves sectors such as construction, shipbuilding, automotive, energy, infrastructure and manufacturing, providing both standard and customized solutions to enhance productivity and quality in metal fabrication and processing.

Founded in 1904 by Swedish inventor Oscar Kjellberg, ESAB pioneered the development of coated welding electrodes, laying the groundwork for modern welding practices.