ESAB's (ESAB) near-term headwinds are "transient," and the company will likely resume a rhythm of outgrowth and margin expansion, Oppenheimer said in a note emailed Friday.

ESAB's shares have declined 8% since the company released its Q2 results in 2025 amid investor worries related to its growth and margin progression after a "noisy" Q2-Q3 period due to tariff-related shipment delays and investment timing, the investment firm said.

ESAB's runway for global outperformance has been strengthened recently, and the further opening of Venezuela and Latin America are additive, the note said, adding that Europe's defense spending will support EMEA opportunities through 2026-2027 and a recent improvement in APAC demand will also back upside growth potential.

Meanwhile, ESAB's acquisition of EWM "furthers equipment growth upside across geographies, with particularly needle-moving prospects in the US market over time," the investment firm said.

Also, ESAB will likely stay aggressive on the M&A front amid favorable signals related to larger-scale and potentially game-changing gas control equipment deals, the note said.

Oppenheimer lifted its price target to $148 from $142, and rated the stock at outperform.

Price: 120.51, Change: -0.89, Percent Change: -0.73