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Linde (LIN)
NASDAQ:LIN
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Linde
(NASDAQ:LIN)
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Rating:76Outperform
Price Target:
$564.00
â–²(16.35% Upside)
Action:UpgradedDate:02/06/26
The score is driven primarily by strong financial performance (multi-year margin and earnings expansion with robust operating cash flow) and supportive earnings-call fundamentals (EPS growth outlook, record backlog, disciplined capital returns). Technicals are constructive with an established uptrend, while the main constraint is valuation (high P/E with a modest yield) alongside noted macro/end-market and leverage/cash-conversion risks.
Positive Factors
Margin expansion & improving profitability
Sustained gross- and net-margin expansion reflects durable operational leverage, pricing power, and cost discipline across gases and engineering. Higher margins and rising net income strengthen free-cash generation capacity and support reinvestment and shareholder returns even if volumes stay muted.
Strong and consistent operating cash flow
Robust operating cash flow provides durable funding for capex, backlog execution, buybacks and dividends. Even with choppy free-cash-flow conversion in some years, persistent high OCF underpins capital allocation flexibility and supports growth investments without over-reliance on new debt.
Record project backlog and clean-energy pipeline
A large, contracted engineering backlog provides multi-period revenue visibility and de-risks near-term growth. Heavy weighting to clean-energy projects aligns Linde with structural decarbonization demand, supporting sustained engineering revenues and long-term footholds in higher-value project work.
Negative Factors
Modest/flat revenue growth
Top-line stagnation means future EPS gains rely more on margin expansion, cash returns and backlog conversion than on broad demand growth. If industrial volumes or pricing weaken, margin-led improvements may be insufficient to sustain historic earnings momentum over the medium term.
Rising leverage and higher capital intensity
Higher net debt and stepped-up capex raise financial risk and reduce flexibility if macro stress appears. Increased capital intensity can compress near-term ROC and makes future cash returns more sensitive to slower cash conversion or higher financing costs, limiting strategic optionality.
Cyclical end-market exposure and commodity headwinds
Dependence on cyclical industrial customers and regional softness (notably EMEA) leaves volumes and packaged sales exposed to macro swings. Unfavorable helium and rare-gas dynamics impose recurring EPS drag, increasing earnings volatility and constraining durable top-line recovery prospects.
Linde (LIN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$224.63B
Dividend Yield1.41%
Average Volume (3M)2.80M
Price to Earnings (P/E)28.8
Beta (1Y)0.40
Revenue Growth1.45%
EPS Growth13.21%
CountryUS
Employees65,069
SectorBasic Materials
Sector Strength58
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)4.20
Shares Outstanding463,394,170
10 Day Avg. Volume2,936,624
30 Day Avg. Volume2,796,127
Financial Highlights & Ratios
PEG Ratio4.12
Price to Book (P/B)5.20
Price to Sales (P/S)5.85
P/FCF Ratio39.07
Enterprise Value/Market Cap1.10
Enterprise Value/Revenue7.25
Enterprise Value/Gross Profit16.74
Enterprise Value/Ebitda19.10
Forecast
1Y Price Target
$517.73Price Target Upside6.81% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering16
EPS Forecast (FY)17.84
Revenue Forecast (FY)$35.56B
Linde Business Overview & Revenue Model
Company DescriptionLinde plc operates as an industrial gas and engineering company in North and South America, Europe, the Middle East, Africa, and the Asia Pacific. It offers atmospheric gases, including oxygen, nitrogen, argon, and rare gases; and process gases, such as carbon dioxide, helium, hydrogen, electronic gases, specialty gases, and acetylene. The company also designs and constructs turnkey process plants for third-party customers, as well as for the gas businesses in various locations, such as olefin, natural gas, air separation, hydrogen, and synthesis gas plants. It serves a range of industries, including healthcare, energy, manufacturing, food, beverage carbonation, fiber-optics, steel making, aerospace, chemicals, and water treatment. The company was founded in 1879 and is based in Woking, the United Kingdom.
How the Company Makes MoneyLinde generates revenue primarily through the sale of industrial gases and related services. Its revenue model is diversified across several key streams: the sale of gases in bulk, packaged gases, and on-site gas supply, where Linde operates facilities directly at customer locations. A significant portion of Linde's earnings also comes from long-term contracts with customers in industries like healthcare and energy, ensuring stable and recurring revenue. Additionally, Linde's engineering segment contributes to its earnings through the design and construction of gas processing plants and related infrastructure. Strategic partnerships and collaborations with various industries enhance Linde's market reach and operational efficiency, further bolstering its financial performance.
Linde Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue across different business units, revealing which segments are performing well and contributing most to the company’s top line.
Breaks down revenue across different business units, revealing which segments are performing well and contributing most to the company’s top line.
Data provided by:
The Fly
The FlyLinde Earnings Call Summary
Earnings Call Date:Feb 11, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call presented several strong positives — record full-year financials (EPS, operating cash flow, margins), an industry-leading 24.2% ROC, a record $10 billion backlog, meaningful sustainability progress (low-carbon power +23% and ~2M tCO2 avoided), robust capital return ($7B+), and commercial wins (90+ application wins and space launch positioning). Offsetting this were persistent headwinds in traditional industrial end markets, regional softness in EMEA and parts of APAC, helium/rare gas headwinds (~1–2% EPS drag), increased capital intensity pressuring ROC in the near term, and a conservative 2026 EPS guide with restructuring charges booked in Q4. Overall, the positives (record results, backlog, cash generation, sustainability and disciplined capital allocation) modestly outweigh the negatives, though management remains appropriately cautious on macro and timing risk.Q4-2025 Updates
Positive Updates
Quarterly Sales Growth
Q4 sales of $8.8 billion, up 6% year-over-year and 2% sequentially; foreign exchange provided a ~3% tailwind; underlying sales ex-FX rose ~3% (2% pricing, 1% volumes).
Strong Profitability and EPS
Q4 operating profit of $2.6 billion with a 29.5% margin; Q4 EPS $4.20, up 6% year-over-year; full-year operating margin improved ~30 basis points.
Record Full-Year Financials and Capital Returns
Company achieved annual record levels for EPS, operating cash flow and operating margins; return on capital of 24.2% (industry-leading) and more than $7 billion returned to shareholders in the year (dividends + buybacks).
Strong Cash Flow and Capital Deployment
Operating cash flow exceeded $3 billion in Q4; CapEx increased ~17% year-over-year to support record project backlog; management invested roughly $6 billion for growth while returning $7.4 billion to owners.
Record Project Backlog and Growth Pipeline
Project backlog at a record ~$10 billion (excludes >$0.5 billion invested for rocket propellants); two-thirds of backlog supports contracted clean energy projects; company expects $2.5–3.0 billion of projects to come off backlog/start up in 2026.
Sustainability and Emissions Progress
Active low-carbon power sourcing increased 23%, enabling ~50% of annual power consumption to be low carbon and supporting an ~2 million metric ton reduction in absolute CO2 emissions toward a 35% reduction target by 2035.
Commercial Wins and New Applications
Signed more than 90 new gas application/oxyfuel wins and additional customer wins in electronics and space launch support; Linde supplies an estimated ~65–75% of launches by Linde involvement (189 launches reported last year).
Capital Allocation Discipline and Share Repurchases
Stepped up share repurchases to $1.4 billion in Q4; management emphasizes sustainable repurchase program anchored by consistent excess free cash flow after dividends.
Negative Updates
Weakness in Traditional Industrial Markets
Persistent retrenchment in manufacturing, metals, chemicals and energy end markets, with broad-based weakness in EMEA and continued softness in certain industrial customers.
Europe / EMEA Challenged
EMEA remains weak with limited signs of substantial recovery; Q4 pricing in Europe slowed to roughly +1% and management is cautious on near-term European catalysts.
Helium and Rare Gas Headwinds
Helium and rare gas dynamics were a drag in 2025; combined helium/rare gas effects represent approximately a 1–2% EPS headwind (upper end likely); helium pricing has been high-single-digit negative in recent quarters and supply dynamics remain unfavorable in some regions.
Volumes and Packaged Consumables Underpressure
Underlying volume growth was modest (1% contribution in Q4) and sequential volumes were flat; packaged gas consumables and gas demand remain flat-to-soft in key markets despite investment in automation equipment.
Increased Capital Intensity Affecting ROC
CapEx growth and acquisitions increased capital intensity; management expects return on capital to remain in the low-to-mid 20% range for the next few years, negatively affecting ROC compared with prior levels.
Restructuring Charges and Timing of Benefits
Additional restructuring actions were initiated in Q4 (referenced ~$230 million); charges are structural with expected cash payback similar to prior programs (~two-year payback) and most benefits anticipated in H2 2026.
Conservative Near-Term Guidance
Full-year 2026 EPS guidance of $17.40–$17.90 (+6% to +9% vs 2025) uses a 0% base volume midpoint and only a 1% FX tailwind; company describes the outlook as guarded/prudent and expects most upside only if macro conditions improve.
Regional Softness Beyond China/India
APAC outside China/India largely stable or weak (Australia still declining in Q4); ASEAN remains flattish and linked to China’s slower recovery; China is described as bottoming but momentum must be confirmed after Chinese New Year.
Timing/Mix Impact on Margins
Q4 margin dilution partly attributed to timing of other income (down over ~$30 million) and some short-term mix effects from project startups and timing of other income items.
Company Guidance
Linde guided 2026 EPS of $17.40–$17.90 (up 6%–9% versus 2025), anchoring the midpoint to 0% base volume change and assuming a 1% full‑year FX tailwind (3% FX benefit in Q1); management remains guarded on the macro outlook and expects restructuring/productivity actions (cash payback ~2 years) to drive most benefits in H2. They reiterated long‑term operating‑margin expansion of ~30–50 bps/year (FY25 margin was up 30 bps) and said 2026 should beat that range, expect ROC to stay in the low‑to‑mid‑20% area (2025 ROC 24.2%), and noted a 1–2% EPS headwind in 2025 from helium/rare‑gas. Capital and cash metrics underpinning the outlook include Q4 operating cash flow >$3.0B, ~17% higher CapEx, about $6.0B invested for growth (roughly half toward secured projects/acquisitions), a record $10.0B backlog (plus >$0.5B for rocket propellants), ~$400M of bolt‑ons closed in 2025, $1.4B of Q4 buybacks and $7.4B returned to shareholders for the year.Linde Financial Statement Overview
Summary
Strong and improving profitability with meaningful margin expansion and rising net income, supported by consistently robust operating cash flow. Offsets include modest/flat recent revenue growth, higher leverage versus earlier years, and uneven free-cash-flow conversion in 2023–2024.Income Statement
Profitability is strong and improving: gross margin expanded from ~26.6% (2020) to ~36.6% (2024), and net margin rose from ~9.2% to ~19.9% over the same period, alongside higher net income ($2.5B in 2020 to $6.6B in 2024). Growth is the main soft spot—revenue has been relatively flat recently (2024 up ~0.5% after a 2023 decline), and 2025 revenue growth is listed as 1.439 but the trajectory overall looks more margin-led than top-line-led.86
Very Positive
Balance Sheet
The balance sheet shows solid scale and equity support (2024 equity ~$38.1B vs. debt ~$22.6B; debt-to-equity ~0.59), and returns improved (return on equity ~17.2% in 2024 vs. ~5.3% in 2020). However, leverage has trended higher over time (debt-to-equity ~0.35 in 2021 to ~0.59 in 2024), and total debt also increased into 2025 (~$27.0B), which adds financial risk if growth slows or rates stay elevated.74
Positive
Cash Flow
Cash generation is consistently strong (operating cash flow ~$7.4B in 2020 to ~$9.4B in 2024 and $10.35B in 2025), supporting ongoing investment and shareholder returns. That said, free cash flow has been choppy (declines in 2022–2024, then a rebound in 2025), and free cash flow covered only about half of net income in 2023–2024 (~0.59 and ~0.52), indicating some earnings-to-cash conversion pressure versus earlier years.78
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 33.99B | 33.01B | 32.85B | 33.36B | 30.79B |
| Gross Profit | 14.73B | 12.08B | 11.55B | 9.71B | 8.62B |
| EBITDA | 12.95B | 12.92B | 12.29B | 9.94B | 9.89B |
| Net Income | 6.90B | 6.57B | 6.20B | 4.15B | 3.83B |
Balance Sheet | |||||
| Total Assets | 86.82B | 80.15B | 80.81B | 79.66B | 81.61B |
| Cash, Cash Equivalents and Short-Term Investments | 5.06B | 4.85B | 4.66B | 5.44B | 2.82B |
| Total Debt | 26.99B | 22.61B | 20.32B | 18.79B | 15.22B |
| Total Liabilities | 47.08B | 40.66B | 39.72B | 38.27B | 36.16B |
| Stockholders Equity | 38.24B | 38.09B | 39.72B | 40.03B | 44.03B |
Cash Flow | |||||
| Free Cash Flow | 5.09B | 4.93B | 5.52B | 5.69B | 6.64B |
| Operating Cash Flow | 10.35B | 9.42B | 9.30B | 8.86B | 9.72B |
| Investing Cash Flow | -5.72B | -4.64B | -4.67B | -3.09B | -3.01B |
| Financing Cash Flow | -4.55B | -4.36B | -5.40B | -3.09B | -7.59B |
Linde Technical Analysis
Neutral
484.74
Price Trends
460.39
Positive
441.01
Positive
454.25
Positive
Market Momentum
11.17
Positive
52.19
Neutral
24.19
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LIN, the sentiment is Neutral. The current price of 484.74 is below the 20-day moving average (MA) of 487.13, above the 50-day MA of 460.39, and above the 200-day MA of 454.25, indicating a neutral trend. The MACD of 11.17 indicates Positive momentum. The RSI at 52.19 is Neutral, neither overbought nor oversold. The STOCH value of 24.19 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $224.63B | 28.82 | 18.07% | 1.41% | 1.45% | 13.21% | |
74 Outperform | $79.71B | 35.83 | 22.40% | 1.01% | 1.38% | -2.54% | |
68 Neutral | $23.85B | 14.71 | 21.34% | 2.71% | -12.98% | -11.34% | |
67 Neutral | $81.74B | 31.08 | 59.39% | 0.98% | 0.96% | 1.96% | |
65 Neutral | $18.51B | -21.54 | -0.80% | 1.74% | 2.42% | -196.54% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
57 Neutral | $60.60B | 20.29 | -2.03% | 2.92% | -0.52% | -110.29% |
* Basic Materials Sector Average
LIN
Linde
484.74
28.82
6.32%
APD
Air Products and Chemicals
272.18
-23.64
-7.99%
ECL
Ecolab
282.69
19.72
7.50%
PPG
PPG Industries
106.70
-5.04
-4.51%
SHW
Sherwin-Williams Company
329.88
-24.73
-6.97%
DD
DuPont de Nemours
45.26
13.77
43.75%
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.