Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 10 Jul, 25 | LIN | Buy | USD 471.27 | USD 496.0 | USD 515.0 | 95 days | Closed |
3.10%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Linde plc operates as an industrial gas company in the Americas, Europe, the Middle East, Africa, Asia, and South 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 air separation, hydrogen, synthesis, olefin, and natural gas plants. It serves a range of industries, including healthcare, chemicals and energy, manufacturing, metals and mining, food and beverage, and electronics. The company was founded in 1879 and is based in Woking, the United Kingdom.
Margin Expansion Demonstrates Operational Strength: Adjusted operating profit margin increased by 120 basis points to 30.1%, reflecting effective cost control and enhanced operational efficiency across business segments
Strong Cash Flow Enhances Financial Flexibility: Operating cash flow rose by 11% year-over-year to USD 2.2 billion, supporting robust free cash generation and significant shareholder returns of USD 1.8 billion
Regional Sales Weakness in APAC and EMEA: Sales declined by 3% in both APAC and EMEA, primarily due to volume pressures in the manufacturing and metals & mining sectors
Overall Volume Contraction Offsets Pricing Gains: Total volumes decreased by 1%, partially negating the benefits of a 2% price increase and limiting underlying sales growth to just 1%
Linde’s exposure to cyclical end markets such as manufacturing and metals & mining presents a risk of volume contraction during economic downturns, which could dampen overall revenue growth despite pricing gains
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 471.27 | 430.0 | 496.0 | 515.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Financial Overview and Earnings Growth: Linde plc reported a robust performance for the first quarter of 2025, with net income of USD 1,673 million and diluted earnings per share (EPS) of USD 3.51, marking an increase of 3% and 5% year-over-year, respectively. On an adjusted basis, excluding Linde AG purchase accounting impacts and other charges, the company posted a net income of USD 1,880 million and EPS of USD 3.95, reflecting a 5% increase year-over-year, or 8% growth excluding currency effects (ex. FX).
Sales and Operating Profit Analysis: Total sales for the quarter stood at USD 8.1 billion, remaining flat year-over-year. Underlying sales grew 1%, driven by a 2% price increase offset by a 1% decline in volumes, particularly due to softness in manufacturing and metals & mining sectors. Operating profit came in at USD 2.18 billion, while adjusted operating profit reached USD 2.44 billion, up 4% from the previous year. This was supported by higher pricing and continued productivity gains across all regions.
Margins and Cash Flow Performance: Linde’s operating profit margin was reported at 26.9%, and the adjusted margin improved by 120 basis points to 30.1%, reflecting enhanced operational efficiency. Operating cash flow increased 11% year-over-year to USD 2.2 billion. After accounting for capital expenditures of USD 1.27 billion, the company generated free cash flow of USD 891 million. During the quarter, Linde returned USD 1.8 billion to shareholders via dividends and share repurchases, net of issuances.
Segment Performance: In the Americas, sales grew 3% year-over-year to USD 3.67 billion, driven by 3% higher pricing and 1% volume growth, particularly in the electronics and energy sectors. The region delivered an operating margin of 31.0%, up 40 basis points. In the Asia Pacific (APAC) region, sales declined by 3% to USD 1.54 billion, with underlying sales down 1% due to volume weakness in manufacturing and mining. However, APAC’s operating margin improved by 120 basis points to 29.3%.
EMEA and Engineering Contributions: The EMEA region reported a 3% decline in sales to USD 2.03 billion, where a 2% rise in pricing was offset by a 3% drop in volumes. Nonetheless, the region achieved an operating profit margin of 35.5%, up 260 basis points. Linde Engineering delivered a 5% sales increase to USD 565 million, with an operating margin of 20.2%. The division secured new orders worth USD 516 million, with a third-party sale of equipment backlog totaling USD 3.3 billion.
Strategic Outlook and Capital Allocation: CEO Sanjiv Lamba emphasized the resilience of Linde’s business model in the face of macroeconomic headwinds. The company’s disciplined capital allocation and margin expansion initiatives contributed to strong financial results and a return on capital of 25.7%. For Q2 2025, Linde projects adjusted EPS between USD 3.95 and USD 4.05, up 3% to 5% (or 5% to 7% ex. FX). Full-year 2025 EPS guidance is reaffirmed at USD 16.20 to USD 16.50, representing a growth of 4% to 6%, or 6% to 8% excluding FX.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given on Linde plc (NASDAQ: LIN) at the closing market price of USD 471.27, as on July 09, 2025.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Basic Materials Industry: Specialty Chemicals
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| LIN Linde plc Ordinary Shares |
-1.07 0.25% | 422.44 | 33.77 | 28.90 | 6.56 | 5.42 | 7.03 | 18.92 |
| AIQUF L'Air Liquide S.A |
- -% | 186.71 | 29.39 | 24.69 | 3.41 | 3.97 | 3.87 | 15.91 |
| AIQUY Air Liquide SA ADR |
-0.05 0.13% | 37.35 | 30.34 | 23.04 | 3.63 | 3.77 | 3.88 | 15.62 |
| SHW Sherwin-Williams Co |
0.85 0.26% | 328.72 | 33.33 | 27.40 | 3.38 | 20.60 | 3.88 | 21.36 |
| APD Air Products and Chemicals Inc |
3.58 1.48% | 245.83 | 18.26 | 24.27 | 5.79 | 4.13 | 6.81 | 12.70 |
Data Powered by EOD Historical Data (“EODHD”).
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is July 09,2025. The reference data in this report has been partly sourced from REFINITIV.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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