A method and apparatus for coating a fastener with head and shank portions is disclosed. The invention includes the steps of and apparatus for transferring the fasteners from a feed mechanism such that the fasteners are positioned for coating. The fasteners are then conveyed through a plurality of operating stations, beginning with a heating station where the shank portions of the fasteners are heated. Subsequently, at a material applying station, a coating material is applied to the heated shank portions. A preferred embodiment of the method and apparatus of the present invention includes using a magnetic holder to carry the fasteners horizontally by their head portions, heating the shank portion to a temperature above the melting point of the applied material and applying the material to the heated shank portion to form a coating thereon. The magnetic holders are part of an endless traveling belt that rotates continually. The fastener carriers have teeth thatengage a rack to rotate the fasteners. A conveyor provides added air cooling for the coated fasteners, which can continue to be rotated. Also disclosed is a transfer wheel with two sets of notches that is synchronously coupled to the traveling belt for placing and aligning fasteners on the belt for coating.