ESAB Corp (ESAB)

Price$75.02Cached quoteAs of 2026-09-05 18:45 UTC

AI: Fair-priced

Price checkThe shares look reasonably priced because a low earnings multiple is offset by unusually high debt.

At the observed market value, ESAB trades at roughly 14 times management’s 2026 adjusted per-share profit midpoint. Including net debt, the operating business is valued at about 11 times management’s adjusted profit before interest, taxes, depreciation and amortization. Those levels are below ESAB’s 2023-2025 year-end forward earnings multiples of roughly 19 to 23 times, but trailing free cash flow still costs about 24 times and leverage is high. The current price assumes management meets near-term guidance and reduces debt; it does not require full 2028 targets. That balance supports Fair-priced.

Big pictureThe Eddyfi deal increases growth potential, but it also leaves shareholders carrying much more financial risk.

Net debt climbed to about $2.32 billion by July 2026 from $1.16 billion at 2025 year-end after the Eddyfi acquisition. ESAB funded the deal partly with $1.0 billion of 5.625% notes, 1.254 million new common shares, and $175 million of 6.5% mandatory convertible preferred stock. Shares outstanding rose about 2.4% from year-end, with possible further dilution when the preferred converts. Current assets remain about twice current liabilities, so short-term liquidity looks adequate, but leverage reduces downside protection and makes debt repayment a central capital-allocation priority.

Business strengthESAB has expanded margins over several years, but recent cash generation has weakened.

Revenue rose from $1.95 billion in 2020 to $2.84 billion in 2025, while gross margin improved from about 35.0% to 36.9% and operating margin from 10.4% to 14.5%. Yet 2025 operating cash flow fell to $261 million from $355 million in 2024, and free cash flow fell to about $213 million from $304 million. In the latest quarter, sales grew 12.9%, including 2.5% growth from the existing business, but the adjusted operating margin fell 0.9 percentage points. The business is stronger, but cash durability is not flawless.

What could change the storySuccessful Eddyfi integration and debt reduction could unlock upside; weak underlying sales growth would justify today’s discount.

The bull case is that Eddyfi reaches the planned contribution, ESAB sustains 2%-4% sales growth without acquisitions, adjusted margins move toward the company’s 22%+ 2028 target, and free cash flow recovers enough to reduce debt quickly. The bear case is that Middle East disruption, logistics costs, or slower equipment demand keep margins compressed while higher interest and preferred dividends absorb cash. Net debt falling below about $1.9 billion and free cash flow returning above $300 million would strengthen the value case; missing current profit guidance would weaken it.

AI: News

Mixed second-quarter updateRecord sales and higher profit guidance were offset by a lower per-share earnings outlook and softer margins.

On August 6, ESAB reported $808 million of quarterly sales, up 12.9%, with 2.5% growth excluding acquisitions and currency. Adjusted operating profit before interest, tax, depreciation and amortization rose 8% to $150 million, but its margin fell 0.9 percentage points. Management raised the 2026 profit outlook to $615 million-$625 million, yet cut adjusted per-share profit guidance to $5.40-$5.50 from $5.70-$5.90. The shares closed about 9% lower by August 10 than on August 6; that timing supports concern, not proof of causation.

Eddyfi acquisition closesESAB closed its biggest recent acquisition, adding inspection technology while sharply increasing debt and potential dilution.

On June 1, ESAB completed the roughly $1.45 billion Eddyfi purchase. The financing included $1.0 billion of 5.625% notes, $143 million from 1.254 million newly issued common shares, and $175 million of 6.5% mandatory convertible preferred stock. Eddyfi had about $240 million of 2025 revenue; management had previously targeted about $100 million of adjusted operating profit including expected synergies. The deal broadens ESAB beyond welding, but investors must judge whether integration gains arrive quickly enough to offset interest costs and dilution.

Loading local price history

Revenue

2020

2021

2022

2023

2024

2025

Net income

2020

2021

2022

2023

2024

2025

Free cash flow

2020

2021

2022

2023

2024

2025

Total cash / debt

CashTotal debt

2020

2021

2022

2023

2024

2025

Financial statements

	2025	2024	2023	2022	2021	2020
Revenue	$2.84B	$2.74B	$2.77B	$2.59B	$2.43B	$1.95B
Gross profit	$1.05B	$1.04B	$1.02B	$885.5M	$838.0M	$682.5M
Gross margin	36.88%	37.85%	36.61%	34.14%	34.51%	35.00%
Research & development	$44.0M	$39.2M	$38.8M	$36.0M	$39.7M	$34.8M
Operating expenses	$144.8M	$162.3M	$168.7M	$140.9M	$531.8M	$480.3M
Operating income	$412.2M	$447.4M	$404.2M	$329.1M	$306.2M	$202.1M
Operating margin	14.50%	16.33%	14.57%	12.69%	12.61%	10.37%
EBITDA	$496.3M	$514.2M	$479.2M	$395.0M	$382.1M	$278.8M
EBITDA margin	17.46%	18.76%	17.27%	15.23%	15.74%	14.30%
Net income	$226.8M	$264.8M	$205.3M	$223.7M	$235.1M	$157.4M
Net profit margin	7.98%	9.66%	7.40%	8.63%	9.68%	8.07%
Basic EPSper basic share	$3.71	$4.36	$3.39	$3.70	$3.92	$2.62
Diluted EPSper diluted share	$3.67	$4.31	$3.36	$3.69	$3.92	$2.62

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

Reported holdings Number of shares

View holders

Top 20 reported holders of ESAB
Holder	Shares held
PRICE T ROWE ASSOCIATES INC /MD/	8.13M
T. Rowe Price Investment Management, Inc.	7.62M
BlackRock, Inc.	5.32M
RALES MITCHELL P	3.72M
Invesco Ltd.	2.77M
VANGUARD CAPITAL MANAGEMENT LLC	2.61M
VANGUARD PORTFOLIO MANAGEMENT LLC	2.48M
FIL Ltd	2.34M
Capital Research Global Investors	1.86M
STATE STREET CORP	1.82M
NEUBERGER BERMAN GROUP LLC	1.54M
FMR LLC	1.54M
DIMENSIONAL FUND ADVISORS LP	1.46M
JPMORGAN CHASE & CO	1.41M
BESSEMER GROUP INC	1.39M
COOKE & BIELER LP	1.27M
GEODE CAPITAL MANAGEMENT, LLC	1.09M
Bank of New York Mellon Corp	955.19K
ROYCE & ASSOCIATES LP	865.83K
DAVENPORT & Co LLC	797.76K

Bars compare reported share counts. A matching total for this share class and reporting period is unavailable, so percentages are not shown.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys1$5.4K disclosed value

Sells (SEC code S)30$18.69M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Feb 27, 2026Form 4 · 10b5-1	Campion MicheleChief Human Resources Officer	SellCommon stock, par value $0.001	2.9K	$122.63	$355.1K	11.2K
Feb 27, 2026Form 4 · 10b5-1	Campion MicheleChief Human Resources Officer	SellCommon stock, par value $0.001	2.2K	$122.63	$269.8K	11.2K
Feb 23, 2026Form 4 · 10b5-1	Kambeyanda ShyamPresident and CEO	SellCommon stock, par value $0.001	1.7K	$128.75	$218.9K	99.9K
Feb 23, 2026Form 4 · 10b5-1	Kambeyanda ShyamPresident and CEO	SellCommon stock, par value $0.001	600	$127.86	$76.7K	101.6K
Feb 23, 2026Form 4 · 10b5-1	Kambeyanda ShyamPresident and CEO	SellCommon stock, par value $0.001	1.3K	$125.79	$163.5K	102.2K