Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on LINDE AG. We currently have 15 research reports from 2 professional analysts.
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2017 revenue guidance: +3% but it might also be -3%
09 Mar 17
Linde suffered a sales and profit setback in Q4 16 and this resulted in full-year numbers that were slightly lower than we had expected. Revenue, compared to the 2015 accounts, were down by 5.6% to just below €17bn, EBIT was down by 1.1% to €2.02bn and pre-tax earnings increased by 6.4% to €1.75bn. Our respective projections were €17.18bn, €2.13bn, and €1.85bn. However, we had expected an unchanged dividend of €3.45 whereas management is proposing €3.70, although the 2017 guidance is very confusing.
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.
The tide is turning
20 Apr 17
Any investor worth their salt knows it is impossible to precisely call a bottom in a particular stock. For Gattaca, though, we believe this moment has now passed given the compelling valuation (6.9x EV/EBIT vs 9.8x sector average), attractive 9.8% unlevered cashflow yield and constructive secular trends supporting its specialist markets. Sure, Net Fee Income (NFI) like-for-likes (LFL) have fallen of late, yet equally there are now early indications that organic growth may soon turn positive.
Panmure Morning Note 26-04-2017
26 Apr 17
The interims highlighted the dilutive impact of equity raise in November 2016 with profit before tax growing by 9% yoy but EPS growing by just 5% yoy. At end-February, the cash balance had reached £15m, of which £5.5m is earmarked for the completion of the new factory. As the company remains cash generative, we expect the company to end fiscal 2017 with just under £13m of cash. We eagerly wait to see how this cash will be invested and drive returns.
N+1 Singer - Small-cap quantitative research - Growth style screen revamp and 10 focus stocks
06 Apr 17
We have reviewed the performance of our consistent growth screen since the previous refresh on 27 September 2016 and revamped the selection parameters to focus more on forecast sales and EPS growth going forward. In the period under review the consistent growth style screen outperformed the small-cap benchmark by c. 6% and underperformed the microcap index by a similar amount. Interestingly, although growth doesn’t always seem to be defensive as might be expected, however it appears right to buy growth on dips caused by or coincident with wider market volatility. In the new forecast growth screen we take a close look at 10 focus stocks. We will monitor performance and refresh it in three to four months time.
N+1 Singer - Trifast - FY17 results ahead of expectations
20 Apr 17
Trifast has provided a positive year end trading update, with good performances across all geographies. Results for FY17 are guided to be ahead of expectations, with year end net debt also lower than previously expected. FY18 has also started well, although management has reiterated slight caution regarding margins due to rising input costs. We anticipate increasing our PBT forecasts by a mid-single digit percentage, and also reducing our net debt estimates. We remain positive on prospects for Trifast and expect the share price to respond positively today.
N+1 Singer - Morning Song 25-04-2017
25 Apr 17
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