Linde plc (LIN) is a prominent player in the specialty chemicals industry, boasting a market cap of $208.5 billion. Headquartered in Woking, United Kingdom, it provides atmospheric and process gases, including oxygen, nitrogen, argon, carbon dioxide, helium, and hydrogen, as well as electronic, specialty, and acetylene gases to various industries. It also designs and constructs turnkey process plants for third-party customers and its own gas businesses, competing closely with its rivals like Air Products and Chemicals, Inc. (APD).
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and Linde fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the basic material sector. With over 50 years of experience in hydrogen, the company has a diversified portfolio and serves various industries. It is also a dividend aristocrat, increasing its dividend for the past 30 years, underscoring its commitment to shareholder value.
Despite its strengths, Linde is currently sailing through choppy waters. The stock is down 9.6% from its 52-week high of $477.71, achieved in mid-March. Moreover, shares of Linde are down 6.6% over the past three months, underperforming the S&P 500 Materials Sector SPDR’s (XLB) marginal gain over the same time frame.
However, in the long term, Linde outperforms the exchange-traded fund. LIN stock is up 5.2% on a YTD basis and surged 19.8% over the past 52 weeks, compared to XLB’s 4.9% returns in 2024 and 13.5% gains over the past 52 weeks.
To confirm the bullish price trend, LIN has been trading above its 200-day moving average. It has also been trading above the 100-day moving average, though it dipped below the mark since May.
Linde stock dipped 5.2% on May 2 following its Q1 earnings results, which showed underwhelming performance in the Americas and a lower-than-expected EPS outlook for Q2. The company reported a 1% volume decrease in the Americas region, with manufacturing, healthcare, and electronics end markets declining.
However, investors are drawn to Linde due to its skillful management, which is expected to offset slower macroeconomic growth in the industry. Analysts are bullish on Linde, praising its proactive strategy in replenishing its project backlog. This is crucial as Linde plans to replace projects worth between $15 billion and $20 billion nearing completion, showcasing its strong operational foresight and potential for sustained growth.
To emphasize the stock’s outperformance over the longer term, it is worth noting that Linde’s stock continues to outshine Air Products and Chemicals. APD stock has gained 1.3% over the past 52 weeks and surged 3.1% on a YTD basis.
Furthermore, analysts are moderately bullish on the stock's outlook. Among the 21 analysts covering the stock, the consensus rating is a “Moderate Buy.” Also, its current mean price target of $478.39 suggests a potential upside of 10.7%.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
