Linde plc: Navigating Challenges Amidst Mega-Cap Status
Based in Woking, United Kingdom, Linde plc (LIN) stands out in the specialty chemicals field. With a market capitalization of $208.5 billion, the company delivers a variety of atmospheric and process gases such as oxygen, nitrogen, argon, carbon dioxide, helium, and hydrogen. Additionally, it supplies electronic, specialty, and acetylene gases across multiple industries.
Linde qualifies as a “mega-cap stock” due to its substantial market cap, illustrating its size, stability, and significant role in the basic materials sector. With over 50 years of expertise in hydrogen, Linde maintains a diverse product lineup that serves a wide range of sectors. Notably, it is recognized as a dividend aristocrat, boasting 30 consecutive years of dividend increases, which underscores its commitment to shareholder value.
Recent Stock Performance Raises Eyebrows
Despite its strong background, Linde is facing a challenging time. The stock price has dipped 5.8% from its 52-week high of $487.49, hit on October 17. Over the last three months, shares of Linde have decreased by 2.7%, lagging behind the S&P 500 Index’s 10.3% gains during the same period.
Looking at performance over a longer timeframe, LIN stock shows a similar trend. It has risen 11.9% year-to-date and 13% over the last year, while the S&P 500 Index has seen a rise of 26.7% in 2024 and 33.2% over the past 52 weeks. Although LIN has remained above its 200-day moving average since the end of November, it has struggled to stay above the 50-day moving average since late October.
Q3 Results Bring Uncertainty
On October 31, Linde’s stock fell more than 3% following the announcement of its Q3 results. The company reported revenue of $8.4 billion, marking a 2.5% increase year-over-year, while adjusted earnings per share (EPS) climbed 8.5% to $3.94. For the full year, Linde anticipates adjusted EPS between $15.40 and $15.50.
For additional context, Linde’s performance has been overshadowed by its top competitor, Air Products and Chemicals, Inc. (APD). Over the past year, APD’s stock has risen 21.2% and has increased 19.6% year-to-date.
Analyst Outlook Remains Positive
Despite the recent setbacks, analysts maintain a solidly positive outlook on Linde’s stock. Among the 20 analysts covering LIN, the consensus rating is a “Moderate Buy.” The average price target is currently $508.12, indicating a potential upside of 10.6% from the current price.
On the date of publication, Kritika Sarmah did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. For more details, please refer to the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
