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Air Liquide (AIQUY)
OTHER OTC:AIQUY
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Air Liquide
(OTC:AIQUY)
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Rating:73Outperform
Price Target:
$46.00
â–²(13.92% Upside)
Action:ReiteratedDate:02/23/26
The score is driven primarily by solid financial performance (strong margins and steady operating cash flow) and a positive earnings outlook with clear margin guidance and strong backlog/cash generation. Technicals are supportive but somewhat extended, while valuation (high P/E and modest yield) is the main constraint.
Positive Factors
Sustained margin expansion
Material margin improvement over 2023–2025 demonstrates durable operating leverage, pricing power and cost efficiency. Stronger margins support recurring profitability even if revenues are soft, improving cash flow potential and ROCE, and underpin medium-term resilience of core earnings.
Record cash generation and strong backlog
High cash generation and a record EUR 4.9bn backlog provide multi-month visibility into profitable project activity and fund CapEx and returns. Reliable OCF combined with a deep pipeline reduces earnings volatility and funds strategic investments without immediate financing pressure.
Electronics momentum and targeted M&A
Growing electronics exposure and bolt-on M&A strengthen positions in a high-margin, secular growth end-market. Successful conversion of opportunities into CapEx and selective acquisitions deepen local density and recurring revenue streams, supporting sustainable high-margin growth over the medium term.
Negative Factors
Multi-year revenue decline
Consecutive annual top-line declines reduce the base for operational leverage and increase reliance on margin gains and cost saves to deliver earnings growth. If demand headwinds persist, sustaining recent margin gains and translating backlog into net-revenue growth becomes harder.
Weaker free cash flow conversion and rising debt
Lower FCF conversion and increased debt modestly reduce financial flexibility. With FCF covering less than half of net income and planned consolidation of acquisitions that raise leverage, the company has less cushion for discretionary returns and is more sensitive to interest or cash-generation setbacks.
Concentration and regional demand risks
Heavy dependence on electronics and pockets of geographic weakness concentrate revenue risk. Cyclical semiconductor investment or regional slowdowns and regulatory/energy uncertainty could delay projects or compress volumes, making future revenue and backlog conversion more volatile.
Air Liquide (AIQUY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$111.09B
Dividend Yield1.94%
Average Volume (3M)10.26K
Price to Earnings (P/E)27.3
Beta (1Y)0.27
Revenue Growth2.04%
EPS Growth13.28%
CountryUS
Employees64,124
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)0.78
Shares Outstanding2,896,464,800
10 Day Avg. Volume0
30 Day Avg. Volume10,260
Financial Highlights & Ratios
PEG Ratio13.07
Price to Book (P/B)3.52
Price to Sales (P/S)3.56
P/FCF Ratio38.22
Enterprise Value/Market Cap0.96
Enterprise Value/Revenue3.96
Enterprise Value/Gross Profit7.87
Enterprise Value/Ebitda13.21
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)1.67
Revenue Forecast (FY)$32.89B
Air Liquide Business Overview & Revenue Model
Company DescriptionAir Liquide is a global leader in gases, technologies, and services for industries and health. The company operates in several sectors, including industrial gases, healthcare, electronics, and renewable energies. Core products and services include oxygen, nitrogen, hydrogen, and specialty gases, as well as integrated solutions for various industrial processes and healthcare applications.
How the Company Makes MoneyAir Liquide generates revenue primarily through the sale of industrial gases, which are used across various industries such as manufacturing, energy, food and beverage, and healthcare. The company operates a diversified revenue model that includes long-term contracts with major industrial clients, which provide stable income streams, as well as on-demand sales. Key revenue streams include the production and distribution of gases, equipment sales, and maintenance services. Additionally, Air Liquide has formed significant partnerships and joint ventures with other companies to enhance its market reach and capabilities, particularly in emerging sectors like hydrogen energy and digital services, which further contribute to its earnings.
Air Liquide Earnings Call Summary
Earnings Call Date:Feb 20, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 23, 2026
Earnings Call Sentiment Positive
The call presented a predominantly positive operational and financial story: modest organic revenue growth, strong margin expansion (130 bps Gas & Services; +100 bps group), recurring net profit growth (~+10% ex-FX), record cash generation (EUR 6.8bn), a record investment backlog (~EUR 4.9bn) and substantial efficiency delivery (EUR 631m). At the same time management acknowledged near‑term regional softness (notably parts of Asia and certain large-industry segments), helium and merchant pockets of weakness, significant restructuring charges (~EUR 200m) to realign European cost structures and regulatory/energy uncertainties in Europe. On balance the positives—margin/leverage gains, cash, backlog, electronics momentum and clear transformation execution—materially outweigh the challenges called out, supporting an overall constructive outlook while highlighting near-term execution and regional demand risks.Q4-2025 Updates
Positive Updates
Modest Organic Sales Growth
Group sales grew +2% on a comparable basis for FY2025, with a slight Q4 acceleration to +2.5% and Gas & Services also up +2% on a comparable basis.
Strong Margin Expansion
Gas & Services operating income ratio (OIR) margin improved +130 basis points excluding energy pass-through; group operating margin improved +100 bps (ex-energy pass-through) and OIR published up +3.5% (excluding currency +7.7%). Management reiterated +100 bps margin improvement guidance for 2026 and added a further +100 bps for 2027, raising the cumulative target to +560 bps (2022–2027).
Recurring Profit and Returns Momentum
Recurring net profit grew ~+10% excluding currency impacts (reported net profit +6.4%); recurring ROCE continued to rise above 11% and has remained >10% since 2022.
Record Cash Generation and Strong Balance Sheet Metrics
Generated record EUR 6.8 billion in cash in 2025; gross CapEx EUR 4.1 billion (EUR 3.7 billion net of divestitures); record dividends paid EUR 1.9 billion; net debt-to-equity stood at 31.2% (pre-DIG acquisition).
Exceptional Efficiency Delivery
Delivered EUR 631 million of efficiencies in 2025, well above the annual ADVANCE objective of EUR 400 million; purchase costs down ~3.6% and personnel expenses reduced through ~5% headcount reduction since early 2024.
Robust Investment Backlog and Pipeline
Investment backlog nearly EUR 4.9 billion (record, >15% above prior year) with 12-month investment opportunities at a record EUR 4.6 billion; backlog and pipeline heavily weighted to electronics (~40%+).
Electronics Business Momentum
Electronics converted ~EUR 1 billion in CapEx over past 24 months and is tracking ~EUR 2 billion of active opportunities; Electronics sales up ~+6% underlying (ex-E&I) in Q4 and now represents >40% of 12-month opportunities.
Strategic M&A and Market Positioning
Acquisition of DIG Airgas in South Korea (closed Jan 2026) completed to strengthen position in large industrial gas market; 13 bolt-on acquisitions closed in 2025 to increase local density.
Shareholder Returns Increased
Board to propose dividend of EUR 3.70 per share (+12% vs prior year) and a 1-for-10 free share attribution proposal (subject to AGM), continuing long-term dividend growth track record.
Sustainability and Safety Achievements
CO2 emissions down 13% vs 2020 baseline and carbon intensity reduced 46% over 10 years; achieved lowest lost-time accident frequency in company history (60% reduction over 2 years).
Negative Updates
Restructuring Costs and Workforce Reduction
Nonrecurring operating items totaled ~EUR 300 million in 2025, including ~EUR 200 million of restructuring costs (mainly Europe) tied to transformation and announced reorganizations affecting multiple countries; global headcount reduced ~5% since early 2024.
Regional Weakness in Large Industry and Asia
Large Industry demand was soft in parts of EMEA and Asia during the year; Asia posted mixed/low activity in some markets and China showed pockets of slowdown and overcapacity in certain segments.
Helium Market Headwinds
Helium volumes and pricing were weak in some regions (notably China), contributing to flat/negative Merchant subsegments and pressuring related sales.
Energy and Regulatory Uncertainty
Energy cost pass-through dynamics and CO2/ETS discussions in Europe create uncertainty for some customers; income tax rate increased to 25.2% in 2025 (vs 24% prior year) due to an exceptional stock tax surcharge in France.
Reduced Visibility on Start-up Revenue
Management no longer discloses a start-up / ramp-up sales proxy for guidance (previously used to estimate revenue from new projects), reducing a historical forecasting indicator for investors.
Local Merchant and Hardgoods Softness
Merchant hardgoods remained soft in some markets; equipment & installation sales normalized after an exceptionally strong 2024, weighing on year-over-year comparables.
Impact of Exxon Baytown Exit and Portfolio Changes
Exit of the ExxonMobil Baytown project removed a large item from the pipeline (compensated, neutral on margins), illustrating project volatility; DIG acquisition will increase net-debt-to-equity by >10 percentage points once consolidated.
Customer Competitiveness Headwinds in Europe
European customers (notably chemicals and some energy-intensive sectors) face structural competitiveness challenges and regulatory uncertainty, possibly delaying some FIDs for decarbonization projects.
Concentration Risk from Electronics Exposure
Electronics now represents a large share (>40%) of the 12-month pipeline and backlog; while high-margin, this growing concentration increases exposure to cyclical shifts in semiconductor investment and competitive dynamics.
Company Guidance
Air Liquide guided for 2026 to deliver an additional +100 basis points of operating margin improvement (OIR) and reiterated its objective to grow recurring net profit at constant exchange rates, while extending the margin ambition with a further +100 bps in 2027 — raising the cumulative margin target to +560 bps over 2022–2027; the group backed this guidance with strong underlying metrics: recurring ROCE above 11%, record cash generation of EUR 6.8bn (cash flow +8% ex‑FX), gross CapEx EUR 4.1bn (EUR 3.7bn net), a EUR 4.9bn investment backlog and EUR 4.6bn of 12‑month opportunities, EUR 631m of efficiencies delivered (vs a EUR 400m annual target), Gas & Services OI margin improvement of +130 bps ex energy pass‑through (group OI margin +100 bps), recurring net profit growth ~+10% ex‑FX in 2025, net debt/equity at 31.2% (pre‑DIG), and continued ESG progress (CO2 -13% vs 2020; carbon intensity -46% over 10 years), alongside proposed shareholder returns (dividend EUR 3.70/share, +12%, and a 1‑for‑10 free share proposal for June 2026).Air Liquide Financial Statement Overview
Summary
Strong and improving profitability (EBIT and net margin expansion) and steady operating cash flow support the score. Offsetting factors include multi-year revenue declines, weaker 2025 free cash flow/cash conversion, and a modest uptick in leverage.Income Statement
Profitability is solid and improving: EBIT margin rose from ~15.3% (2023) to ~20.7% (2025) and net margin improved to ~13.1% (2025) from ~11.1% (2023). However, revenue momentum is weak, with sales declining in each of the last three years (2023–2025), including a sharper drop in 2025 (-5.6%), which tempers the otherwise strong margin story.78
Positive
Balance Sheet
Leverage looks manageable for a large specialty chemicals business, with debt-to-equity around ~0.56 in 2025 (broadly in line with recent years), and equity has remained substantial versus total assets. The main watch-out is rising debt in 2025 versus 2024 (total debt up while equity slipped modestly), which slightly reduces balance-sheet flexibility despite generally stable capitalization.74
Positive
Cash Flow
Cash generation is consistent, with operating cash flow staying around ~$6.1–$6.3B (2023–2025), supporting ongoing investment needs. That said, free cash flow weakened in 2025 (down ~12.3%) and free cash flow covers less than half of net income in 2025 (~40%), indicating heavier reinvestment and/or working-capital drag and leaving less cushion for shareholder returns.70
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 25.88B | 27.06B | 27.61B | 29.93B | 23.33B |
| Gross Profit | 9.26B | 17.05B | 16.46B | 16.12B | 13.95B |
| EBITDA | 7.82B | 7.29B | 6.71B | 6.81B | 6.11B |
| Net Income | 3.38B | 3.31B | 3.08B | 2.76B | 2.57B |
Balance Sheet | |||||
| Total Assets | 51.89B | 51.87B | 48.33B | 49.52B | 46.78B |
| Cash, Cash Equivalents and Short-Term Investments | 3.96B | 1.92B | 1.62B | 1.91B | 2.25B |
| Total Debt | 14.66B | 12.45B | 12.04B | 13.45B | 13.88B |
| Total Liabilities | 24.96B | 24.25B | 23.29B | 24.84B | 24.69B |
| Stockholders Equity | 26.20B | 26.86B | 24.32B | 23.74B | 21.46B |
Cash Flow | |||||
| Free Cash Flow | 2.41B | 2.80B | 2.87B | 2.31B | 2.45B |
| Operating Cash Flow | 6.10B | 6.32B | 6.26B | 5.59B | 5.37B |
| Investing Cash Flow | -3.64B | -3.58B | -3.08B | -3.24B | -3.35B |
| Financing Cash Flow | -134.76M | -2.81B | -3.48B | -2.78B | -1.82B |
Air Liquide Technical Analysis
Negative
40.38
Price Trends
38.64
Positive
38.71
Positive
39.92
Negative
Market Momentum
0.39
Positive
40.95
Neutral
-0.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIQUY, the sentiment is Negative. The current price of 40.38 is below the 20-day moving average (MA) of 40.48, above the 50-day MA of 38.64, and above the 200-day MA of 39.92, indicating a neutral trend. The MACD of 0.39 indicates Positive momentum. The RSI at 40.95 is Neutral, neither overbought nor oversold. The STOCH value of -0.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AIQUY.
Air Liquide Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $224.11B | 28.82 | 18.07% | 1.41% | 1.45% | 13.21% | |
74 Outperform | $79.48B | 35.83 | 22.03% | 1.01% | 1.38% | -2.54% | |
73 Outperform | $111.09B | 27.28 | 13.49% | 1.94% | 2.04% | 13.28% | |
65 Neutral | $18.50B | -21.54 | -3.77% | 1.74% | 2.42% | -196.54% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
60 Neutral | $21.53B | -18.77 | -7.03% | 12.78% | -19.65% | -157.13% | |
57 Neutral | $61.10B | 20.29 | -2.20% | 2.92% | -0.52% | -110.29% |
* Basic Materials Sector Average
AIQUY
Air Liquide
38.35
-0.93
-2.37%
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DD
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LIN
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6.08%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.