Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on LINDE AG. We currently have 14 research reports from 2 professional analysts.
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Prohibited insider trading?
15 Jan 17
The German watchdog Bafin is investigating potential insider trading at Linde. According to the allegation, Wolfgang Reitzle, the Chairman of the Supervisory Board, bought 4,000 shares in June for around €123 per share after being promoted to this position in May. However, at that time, Linde and Praxair had started to discuss their merger and the first speculations about the merger were made public in August. Assuming Bafin is right that the discussions between the two companies had started in June, Reitzle’s transaction was illegal.
Chaos at the helm intensifies with the second intended Praxair merger
08 Dec 16
Wolfgang Reitzle, Chairman of the Supervisory Board, is again pressing Linde into a merger of equals with Praxair. As a result, CEO Wolfgang Büchele has stepped down with immediate effect and Aldo Belloni, a Linde Management Board member from 2000 to 2014, has been brought out of retirement. Belloni and Reitzle were both Linde top managers through to 2014, i.e. they can be regarded as buddies. The above management changes are the result of Reitzle having re-opened the merger negotiations with Praxair to make Linde the world’s largest industrial gas producer, which in itself is no viable economic goal for us. In the context of the first merger talks in summer of this year, the then CFO Denoke stepped down with immediate effect (or was most likely fired as he rejected the deal) and CEO Büchele decided not to prolong his contract beyond 2017. It seems to us that the two buddies (i.e. Reitzle and Belloni) will try whatever they can to merge the two companies. It is surprising to us that the Supervisory Board has apparently unanimously (i.e. including employee and union representatives) agreed to the negotiations. However, a glance at the composition of the Board reveals that it is hardly made up of genuinely independent members.
Linde (LIN GY) / Praxair (PX US) – Round 2
30 Nov 16
Linde confirmed yesterday it has received a revised proposal concerning a potential merger of equals. Linde’s executive board is currently reviewing the proposal. Praxair confirmed yesterday that it has “approached Linde about resuming discussions on a possible merger”. Its no great surprise that talks have been rekindled. Especially after the management changes which followed quickly after talks last broke down over the Summer.
Linde delivered what we had expected
28 Oct 16
Revenue fell by 2.4% to €4.4bn in Q3 and by 4.3% to just below €13bn ytd. Simultaneously, the respective EBIT numbers were up by 3.7% to €527m and 5.6% to €1.62bn and the pre-tax profit numbers by 13% to €458m and 11% to €1.37bn. All these numbers are slightly ahead of our expectations.
Management in shambles
14 Sep 16
After the merger with Praxair was called off, CFO Denoke was made to leave with immediate effect and CEO Büchele will not extend his contract which expires in 2017. There was no wishing him well in Linde’s statement for Denoke but there was for Büchele. We can only speculate why this chaos is suddenly appearing. The Chairman of the Supervisory Board, Reitzle, who was the acting CEO until 2014, joined the Board in May this year. He is believed to have been the driving force behind the intended merger and seems to have been supported by Büchele but not by Denoke and not by several other shareholder representatives on the Board. If this speculation is correct, Reitzle should also step down.
Lower than expected revenue but higher profits
28 Jul 16
Linde’s revenue fell by 7.3% to €4.3bn in Q2, which brought the H1 number to €8.56bn, a drop of 5.3%. At the same time, EBIT increased by 12% to €562m and 6.5% to €1.09bn, respectively, and the pre-tax numbers were +16% to €468m and +10% to €909m. While revenue fell short of our projected €8.82bn, the two H1 profit numbers are ahead of our €1.02bn and €874m. Management continues to be cautious for the full-year and sees ‘currency-adjusted’ revenue and operating earnings both changing by about -3% and +4%.
20 Feb 17
Hayward Tyler Group* (HAYT): Trading update and financial position (CORP) | Petra Diamonds (PDL): Interim results (BUY) | Gemfields* (GEM): Interim results (CORP) | Premaitha Health* (NIPT): Middle East momentum (CORP) | Sound Energy (SOU): Acquisition update and TE-8 well spud (HOLD) | Proactis* (PHD): Interim trading on track (CORP) | 7digital* (7DIG): Automotive contract win (CORP)
21 Feb 17
Lighthouse Group* (LGT): Middle Britain growth (CORP) | Utilitywise* (UTW): Double-digit sales growth (CORP) | Trakm8* (TRAK): Earnings expectations cut again (CORP) | dotDigital* (DOTC): Myriad growth opportunities (CORP) | Artilium* (ARTA): Five-year Telenet deal secured and prepaid (CORP) | Netcall* (NET): Cloud investment pays off (CORP)
N+1 Singer - Small-cap quantitative research - New quality style screen + 11 quality focus stocks
09 Feb 17
We introduce our fourth and final style screen representing “quality”. This screens for stocks with the best combination of high returns on capital/equity, EBIT margins and operating cash-flow conversion rates. These criteria should help us monitor how strong underlying returns translate into share price performance over time and under varying market conditions. The screen selects the “best” 25 stocks from our universe of just over 500 stocks and, as usual, we focus on a shorter list of stocks we cover or otherwise know and believe to be particularly interesting. We provide brief investment summaries on these focus stocks on pages 4 – 9. We will monitor performance and refresh the screen in approximately 3-4 months time.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Time to go over weight
24 Feb 17
We believe equity investors are taking an unnecessarily cautious stance on the construction sector. Forward looking indicators (e.g. consumer confidence, construction PMIs and housing starts) point to a stable market and recent sales LFL are particularly encouraging (e.g. Marshalls). Near term margins may suffer temporary distortions as inflationary pressures build. However, history has shown that modest input cost inflation is actually a positive for earnings growth in the sector. Therefore, as we move into 2018, margin trends are likely to surprise on the upside.
N+1 Singer - Morning Song 22-02-2017
22 Feb 17
CORETX (COR LN) Contract wins and new Lifestyle facility | Gooch & Housego (GHH LN) Solid Q1 trading plus earnings enhancing acquisition of StingRay Optics | NCC Group (NCC LN) Further issues in Assurance | PCI-PAL (PCIP LN) Strong H1 underpins positive outlook | UBM (UBM LN) Results | Verona Pharma (VRP LN) Phase IIa RPL554 add-on trial to tiotropium commenced