ESAB vs LII

For growth investors, ESAB Corporation (ESAB) is the stronger pick with 3.

7% revenue growth year-over-year, versus -2. 7% for Lennox International Inc. (LII). Lennox International Inc. (LII) offers the better valuation at 23. 7x trailing P/E (21. 7x forward), making it the more compelling value choice. Analysts rate ESAB Corporation (ESAB) a "Buy" — based on 10 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, Lennox International Inc.

(LII) is the cheapest at 23. 7x versus ESAB Corporation at 27. 5x. On forward P/E, ESAB Corporation is actually cheaper at 17. 7x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Lennox International Inc. wins at 1. 13x versus ESAB Corporation's 2. 44x — a reasonable growth-adjusted valuation.

Over the past 5 years, ESAB Corporation (ESAB) delivered a total return of +107.

2%, compared to +57. 8% for Lennox International Inc. (LII). Over 10 years, the gap is even starker: LII returned +309. 4% versus ESAB's +107. 2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), Lennox International Inc.

(LII) is the lower-risk stock at 1. 23β versus ESAB Corporation's 1. 24β — meaning ESAB is approximately 1% more volatile than LII relative to the S&P 500. On balance sheet safety, ESAB Corporation (ESAB) carries a lower debt/equity ratio of 65% versus 177% for Lennox International Inc. — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), ESAB Corporation (ESAB) is pulling ahead at 3.

7% versus -2. 7% for Lennox International Inc. (LII). On earnings-per-share growth, the picture is similar: Lennox International Inc. grew EPS -1. 4% year-over-year, compared to -13. 7% for ESAB Corporation. Over a 3-year CAGR, LII leads at 3. 3% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

Lennox International Inc.

(LII) is the more profitable company, earning 15. 1% net margin versus 8. 0% for ESAB Corporation — meaning it keeps 15. 1% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: LII leads at 19. 5% versus 17. 3% for ESAB. At the gross margin level — before operating expenses — ESAB leads at 35. 5%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Lennox International Inc. (LII) is the more undervalued stock at a PEG of 1. 13x versus ESAB Corporation's 2. 44x. A PEG below 1. 5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, ESAB Corporation (ESAB) trades at 17. 7x forward P/E versus 21. 7x for Lennox International Inc. — 4. 0x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for ESAB: 43. 2% to $146. 67.

All stocks in this comparison pay dividends.

Lennox International Inc. (LII) offers the highest yield at 0. 9%, versus 0. 4% for ESAB Corporation (ESAB).

For long-horizon retirement investors, Lennox International Inc.

(LII) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 1. 23), 0. 9% yield, +309. 4% 10Y return). Both have compounded well over 10 years (LII: +309. 4%, ESAB: +107. 2%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Industrials sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

LII pays a dividend while ESAB does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.