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Linde (LIN)
NASDAQ:LIN
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Linde
(NASDAQ:LIN)77Outperform
Positive Factors
Backlog and Growth Opportunities
LIN is poised for near/long-term upside to numbers due to the backlog growing and distractions at a peer.
New Project Announcements
There is a high likelihood of announcing new electronics wins and CCS projects soon, indicating potential growth opportunities.
Negative Factors
Industrial Market Recession
Industrial markets remain in recessionary mode.
Linde (LIN) vs. S&P 500 (SPY)
Market Cap
$218.18B
Dividend Yield1.21%
Average Volume (3M)2.27M
Price to Earnings (P/E)33.9
Beta (1Y)0.75
Revenue Growth0.46%
EPS Growth7.97%
CountryUS
Employees65,289
SectorBasic Materials
Sector Strength56
IndustryChemicals
Share Statistics
EPS (TTM)13.62
Shares Outstanding472,911,620
10 Day Avg. Volume2,291,234
30 Day Avg. Volume2,270,674
Financial Highlights & Ratios
PEG Ratio4.25
Price to Book (P/B)N/A
Price to Sales (P/S)6.62
Price to Cash Flow (P/CF)19.50
P/FCF Ratio17.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$506.92Price Target Upside8.26% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering15
Linde Business Overview & Revenue Model
Company DescriptionFounded in 2017, UK-based Linde Plc is a leading global industrial gases and engineering company. The company serves a variety of end markets including chemicals & refining, food & beverage, electronics, healthcare, manufacturing and primary metals. Linde generates revenues through the following segments: Americas, EMEA (Europe, Middle East & Africa), APAC (Asia Pacific), Engineering and Others.
How the Company Makes MoneyLinde makes money primarily through the production and distribution of industrial gases to a diverse range of end markets, including healthcare, manufacturing, and energy. The company operates through two main business segments: Gases and Engineering. The Gases segment generates revenue through the sale of gases and related equipment, offering on-site gas production, pipeline supply, and packaged gas. The Engineering segment designs and constructs large industrial plants, contributing to the company's revenue by leveraging its expertise in process technologies. Linde also capitalizes on long-term contracts and strategic partnerships, providing stability and growth opportunities. Additionally, the company invests in innovations like hydrogen energy solutions, which position it for future revenue expansion as global energy demands evolve.
Linde Financial Statement Overview
Summary
Linde exhibits strong financial health characterized by consistent revenue growth, high profitability, a balanced capital structure, and healthy cash flows. While the company has a stable leverage position, maintaining its cash flow growth will be crucial to sustain its financial strength in the competitive chemicals industry.Income Statement
Linde has demonstrated strong financial performance with consistent revenue growth and improving profit margins. The Gross Profit Margin for 2024 is 48.06%, and the Net Profit Margin is 19.89%, both indicating high profitability. Revenue has grown steadily, and the EBIT Margin of 26.16% and EBITDA Margin of 38.63% further underscore operational efficiency.88
Very Positive
Balance Sheet
Linde maintains a solid balance sheet with a moderate Debt-to-Equity Ratio of 0.57, reflecting manageable leverage. The company has a strong Equity Ratio of 47.52%, showing a stable financial structure. Return on Equity is robust at 17.23%, indicating efficient use of equity capital.75
Positive
Cash Flow
Linde's cash flow position is strong, with a significant Free Cash Flow of $4.93 billion, though slightly down from the previous year. The Operating Cash Flow to Net Income Ratio of 1.43 suggests healthy cash generation relative to earnings. Free Cash Flow to Net Income Ratio stands at 0.75, indicating good cash conversion.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 33.01B | 32.85B | 33.36B | 30.79B | 27.24B | Gross Profit |
| 15.86B | 15.36B | 13.91B | 13.25B | 11.86B | EBIT |
| 8.63B | 8.02B | 5.37B | 4.98B | 3.32B | EBITDA |
| 12.75B | 12.22B | 10.86B | 10.14B | 8.73B | Net Income Common Stockholders |
| 6.57B | 6.20B | 4.15B | 3.83B | 2.50B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 4.85B | 4.66B | 5.44B | 2.82B | 3.75B | Total Assets |
| 80.15B | 80.81B | 79.66B | 81.61B | 88.23B | Total Debt |
| 21.62B | 20.32B | 17.91B | 14.21B | 16.15B | Net Debt |
| 16.77B | 15.65B | 12.48B | 11.38B | 12.40B | Total Liabilities |
| 40.66B | 39.72B | 38.27B | 36.16B | 38.65B | Stockholders Equity |
| 38.09B | 39.72B | 40.03B | 44.03B | 47.32B |
| Cash Flow | Free Cash Flow | |||
| 4.93B | 5.52B | 5.69B | 6.64B | 4.03B | Operating Cash Flow |
| 9.42B | 9.30B | 8.86B | 9.72B | 7.43B | Investing Cash Flow |
| -4.64B | -4.67B | -3.09B | -3.01B | -2.99B | Financing Cash Flow |
| -4.36B | -5.40B | -3.09B | -7.59B | -3.35B |
Linde Technical Analysis
Positive
468.25
Price Trends
442.25
Positive
450.28
Positive
449.35
Positive
Market Momentum
5.44
Positive
61.34
Neutral
48.91
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LIN, the sentiment is Positive. The current price of 468.25 is above the 20-day moving average (MA) of 461.11, above the 50-day MA of 442.25, and above the 200-day MA of 449.35, indicating a bullish trend. The MACD of 5.44 indicates Positive momentum. The RSI at 61.34 is Neutral, neither overbought nor oversold. The STOCH value of 48.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LIN.
Linde Risk Analysis
Linde disclosed 17 risk factors in its most recent earnings report. Linde reported the most risks in the “Macro & Political” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Linde Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $218.18B | 33.87 | 17.23% | 1.21% | 0.46% | 7.97% | |
73 Outperform | $10.72B | 12.13 | 16.11% | 3.50% | 1.91% | 2.94% | |
67 Neutral | $67.93B | 17.73 | 22.98% | 2.32% | -3.12% | 64.53% | |
63 Neutral | $1.18B | 77.40 | 5.11% | 1.16% | 22.63% | ― | |
58 Neutral | $25.07B | 22.75 | 6.14% | 7.86% | -3.72% | 91.57% | |
54 Neutral | $1.64B | ― | -42.06% | ― | -8.09% | -1.97% | |
47 Neutral | $2.64B | -4.00 | -31.55% | 3.33% | 2.93% | -29.90% |
* Basic Materials Sector Average
Performance Comparison
LIN
Linde
468.25
8.57
1.86%
PX
P10 Holdings
12.08
4.18
52.91%
APD
Air Products and Chemicals
311.58
72.77
30.47%
EMN
Eastman Chemical
97.73
11.45
13.27%
OI
O-I Glass
11.72
-5.16
-30.57%
DOW
Dow Inc
37.78
-15.87
-29.58%
Linde Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: 3.21% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Linde's strong financial performance, sustainability achievements, and record backlog growth despite challenges such as significant foreign exchange headwinds and economic difficulties in EMEA and China. The company remains optimistic about its ability to continue delivering shareholder value.Highlights
Sustainability Achievements
Linde increased its active low carbon and renewable energy consumption by 19% year-over-year, with over 40% of total power consumption now being low carbon based. Linde was also included in the Dow Jones Sustainability World Index for the 22nd consecutive year.
Financial Performance
Linde led the industry with a 25.9% ROC, EBIT margins increased by 190 basis points to 29.5%, and EPS rose by 10% despite FX headwinds, with $7 billion returned to shareholders.
Record Backlog and Growth
Linde ended the year with a backlog of more than $10 billion, including a record sale of gas backlog of $7 billion. This includes a significant $2 billion project win in Canada.
Small Onsite Contracts
Linde set a record for small onsite wins, signing 59 long-term agreements for a total of 64 plants.
Lowlights
Foreign Exchange Headwinds
Linde experienced a 4% FX translation headwind that impacted financial results, driven by a significant strengthening of the U.S. dollar.
EMEA Volume Decline
Volume growth was flat as contributions from the project backlog in the Americas and APAC offset lower base volumes in EMEA, primarily due to softer metals and mining volumes.
Economic Challenges in China
Linde does not expect a significant recovery in China for 2025, with industrial volumes expected to remain stable and flat, and metals and mining likely to be negative year-on-year.
Company Guidance
During the Linde Fourth Quarter and Full Year 2024 Earnings Teleconference, the company outlined its guidance for 2025, focusing on key financial metrics and strategic priorities. Linde plans to achieve 10-plus percent EPS growth, driven by a combination of capital allocation and management actions, despite facing a 4% FX translation headwind. The company reported a record $7 billion in backlog for the sale of gas projects and anticipates a 4% to 7% EPS growth, or 8% to 11% when excluding currency impacts. The guidance assumes a flat industrial production environment, with management actions expected to deliver margin expansion of 20 to 50 basis points. Additionally, Linde aims to reduce greenhouse gas emissions by 35% by 2035, and highlighted its commitment to sustainability, with over 40% of its power consumption now sourced from low carbon and renewable energy.Linde Corporate Events
Executive/Board Changes
Linde Announces Retirement of Executive John Panikar
Neutral
Dec 2, 2024
John Panikar, former Executive Vice President-APAC at Linde plc, will retire on March 31, 2025, after 33 years of service. During his transition, he will maintain his salary and benefits while being eligible for a performance-based bonus. Post-retirement, Panikar will receive a severance package exceeding $1.4 million, along with COBRA health benefits. He will also adhere to non-disclosure and non-compete agreements, reflecting Linde’s structured approach to leadership transitions.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.