- Company name
- Linde
- Sector
- Industrial gases
- About
- Linde is the largest industrial gas company in the world, with sales of $34.0 billion in 2025. It produces oxygen, nitrogen and argon from air, and it also sells hydrogen, helium, carbon dioxide and specialty gases. Large customers, such as chemical plants, refineries, steel mills and chip factories, get gas by pipeline from plants that Linde builds on or next to their sites, under contracts of 10 to 20 years with minimum purchase amounts and price escalation. Smaller customers buy liquid gas by truck or gas in cylinders. Linde Engineering designs and builds gas plants for Linde and for other companies. Linde also owns Lincare, a US home care business that supplies oxygen and respiratory equipment to patients. About 64% of 2025 sales came from outside the US. Linde makes money from long contracts and price increases, with an adjusted operating margin of 29.4% in Q3 2026.
- Thesis
- Linde trades at a discount because investors doubt that it can keep its margin and its earnings growth while industrial demand stays weak. The adjusted operating margin was 29.4% in Q3 2026, 30 basis points lower than a year earlier and about the same as the 29.5% of Q2. Lincare, its US home care business, is the main drag, because its prices do not keep pace with cost inflation. Linde moved Lincare into a separate segment and studies options that include a sale, but it says that a sale is not certain. Helium costs also rose because of the conflict in the Middle East. In Q3 2026, Linde took a charge of $425 million for severance and for actions at Lincare. Management expects the savings to reach their full rate in the second half of 2027. Linde plans $5.5 billion to $6.0 billion of capital spending in 2026, so investors see more cash going into new plants before the profit comes. The long contracts and the $7.9 billion sale of gas backlog, mostly for electronics customers, support future growth. For the gap to close, Linde must reach its Q4 2026 adjusted EPS guidance of $4.40 to $4.50, show a higher margin in 2027 as the cost savings arrive, decide what to do with Lincare, and grow the sale of gas backlog again. The Q4 report and the 2027 outlook, expected in early 2027, give the next test. If the margin recovers and Linde stays within its long-term target of 8% to 12% EPS growth, the gap can close over the next two to four quarters. The main risk is a longer slowdown in industrial production in Europe and Asia.
- Risks
- Volumes depend on industrial production. In Q3 2026, EMEA volumes grew only 1%, and press reports of the call said that management sees no near-term recovery in Europe. Linde's guidance assumes no economic improvement.
Lincare, the US home care business, lowers the margin because its prices do not keep pace with cost inflation. In Q3 2026, Linde took $183 million of non-cash charges, mostly for Lincare. Management studies options that include a sale, but it gave no date for a decision and said that a sale is not certain.
Linde plans $5.5 billion to $6.0 billion of capital spending in 2026, mostly for its $7.9 billion sale of gas backlog. Delays at customers, such as chip factories, can postpone the return on these plants.
The conflict in the Middle East raised helium supply costs. Management expects normal conditions only in early 2027, if supply from Qatar restarts.
About 64% of sales come from outside the US, so a stronger US dollar lowers reported sales and EPS.
- Balance sheet
- Cash: $3.9B
Debt: $26.7B
Net debt: $22.8B
EBITDA, last 12 months: $13.2B
Net debt / EBITDA: 1.7× (low)
Interest cover: 37×
Undrawn credit line: $6.5B
Debt due within 12 months: $6.1B
Ratings: S&P A, Moody's A2
Linde has strong credit ratings and long-dated debt. At September 30, 2026, short-term debt was $4.6 billion, mostly $4.3 billion of commercial paper, and $1.5 billion of long-term debt was due within one year. Linde issued €1.6 billion of euro notes in May 2026 and repaid notes of $725 million, $200 million and a euro note due in 2026 in the first nine months. EBITDA is the reported EBITDA for the 12 months to September 2026. It includes the Q3 2026 charge of $425 million. Interest cover uses net interest expense for the first nine months of 2026. Linde has two undrawn revolving credit agreements with no financial maintenance covenants: $5.0 billion to December 7, 2027 and $1.5 billion to December 2, 2026. The ratings are from the 10-K for 2025. Net debt was $22.8 billion at September 30, 2026, up from $21.9 billion at December 31, 2025. In the first nine months of 2026, Linde bought back $2.6 billion of shares and paid $2.2 billion of dividends. Operating cash flow was $3.2 billion in Q3 2026 alone.
As of Sep 30, 2026.
- Checkpoints
- Oct 29, 2026: Q3 2026 results: margin and EPS guidance. Failed. Watch: Adjusted EPS of $4.45 to $4.55 or more and a higher adjusted operating margin than in Q2 2026 pass; a lower margin or a cut to the 2026 guidance fails. Outcome: Adjusted EPS of $4.59 beat the guidance and Linde raised its 2026 guidance, but the adjusted operating margin of 29.4% was slightly lower than the 29.5% of Q2 2026.
Jan 29, 2027 (estimate): Q4 2026 results and 2027 outlook. Pending. Watch: 2027 EPS guidance within the long-term growth target of 8% to 12%, a higher margin from the cost savings and a sale of gas backlog above $8 billion pass; guidance below 8% growth fails.
2027 (estimate): Decision on Lincare. Pending. Watch: A sale or a clear plan that removes the margin drag of Lincare passes; no decision and a further fall in its margin fail.
- Recent events
- Oct 29, 2026: Linde reported Q3 2026 results. Sales were $9.40 billion, up 9%, with underlying sales up 5% from 3% higher prices and 2% higher volumes. Adjusted EPS was $4.59, up 9%, and the adjusted operating margin was 29.4%, 30 basis points lower than a year earlier. Reported EPS was $3.66, down 11%, because of a charge of $425 million. Operating cash flow was $3.17 billion. Linde raised its 2026 adjusted EPS guidance to $17.82 to $17.92 and guided Q4 2026 adjusted EPS at $4.40 to $4.50. The sale of gas backlog fell to $7.9 billion, from $8.1 billion at the end of Q2.
Oct 29, 2026: The Q3 2026 charge of $425 million includes $200 million of global severance, $42 million of other cost reduction charges and $183 million of non-cash charges, mostly for Lincare. Press reports of the call said that management expects the cost savings to pay back the charge in 1.5 to 2 years, with the full savings rate in the second half of 2027. Lincare now reports to the CFO in a separate segment while Linde studies options, and management said that a sale is not certain.
Oct 5, 2026: Linde said that it will report Q3 2026 results by 6:00 a.m. EDT on October 29, 2026, with a conference call at 9:00 a.m. EDT.
Jul 31, 2026: Linde reported Q2 2026 results. Sales were $9.29 billion, up 9%, with underlying sales up 4% from 2% higher prices and 2% higher volumes. Adjusted EPS was $4.50, up 10%, and the adjusted operating margin was 29.5%. Linde raised the low end of its 2026 adjusted EPS guidance to $17.70 to $17.90 and raised its capital spending plan to $5.5 billion to $6.0 billion. A new US electronics contract raised the sale of gas backlog to a record $8.1 billion. The stock fell about 5% on the day.
Jul 31, 2026: On the Q2 2026 call, management said that Lincare was the main reason for the lower margin, and that Linde studies strategic options for Lincare, including a partial or full sale. Management also said that helium costs will not normalize in 2026 and expects this in early 2027, depending on the Strait of Hormuz and the restart of supply from Qatar.
May 13, 2026: Linde issued €1.6 billion of notes in three parts: €600 million of floating rate notes due 2028, €500 million of 3.200% notes due 2030 and €500 million of 3.800% notes due 2036.
May 1, 2026: Linde reported Q1 2026 results. Sales were $8.8 billion, up 8%, with underlying sales up 3%. Adjusted EPS was $4.33, up 10%. The adjusted operating margin was 30.0%, down 10 basis points. Linde guided 2026 adjusted EPS at $17.60 to $17.90.