QS Research · Michael Burry's Scion Capital analyst template · 2006
LINDE PLC (LIN)
As of 2026-11-08 · 12/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case +0% · downside -22% · upside +11%
The market is paying a premium for a high-quality industrial-gas franchise: at $515.25 the stock is 20.0x TTM EV/EBITDA and 33.8x TTM P/E on TTM to Sep 30, 2026, with a 2.1% FCF yield. Using the section 13 TTM EBITDA base of $12.99B, 20.0x gives about $516 (+0.2%), 16.0x gives $403 (-21.8%) and 22.0x gives $573 (+11.2%), so the risk/reward is roughly 2:1 against and the rule does not justify a long or a short. The operating story is real—Q3 2026 adjusted EPS $4.59 +9%, FY2026 adjusted EPS guidance $17.82-$17.92 and an $11B project backlog—but reported EPS is depressed by the $425M charge and cash returns exceed FCF. I would watch for a better entry or a failed catalyst rather than pay today's multiple.
Key numbers
- Share price: $515.25
- Market cap: $236.54B
- Latest financial period: TTM to Sep 30, 2026
- Revenue (TTM): $36.24B
- EV / EBITDA (TTM): 20.0x
- P/E (TTM): 33.8x
- Price / book: 6.00x
The 15 boxes
- ✓ 1. Long-form business notes
Linde is a global industrial-gas producer plus an Engineering plant builder; FY2025 sales were $33,986M, versus $33,005M in FY2024 and $32,854M in FY2023, while the XBRL table shows $27.24B in FY2020. The business runs through on-site/tonnage contracts typically 10-20 years, merchant contracts usually 3-7 years, and packaged gases generally 1-3 years, with energy the largest cost and contract pass-through mechanisms. Between the FY2020 and FY2025 10-Ks, reported sales, operating income and operating cash flow increased, headcount fell to 65,177 from 74,207, and non-U.S. sales were approximately 64% in 2025 versus approximately 69% in 2020.
- ○ 2. Competitive advantage
The sources support a qualified durable advantage: Linde's 10-K cites >80-country scale/diversification, proprietary technology, large contracts with energy/feedstock pass-through, and key-personnel expertise, while FY2020-FY2025 XBRL shows operating income and net income rising much faster than revenue and strong operating cash flow. The same 10-K flags cyclical end markets, energy cost, and goodwill impairment, and it names no competitors. No TTM/2026 period, 10-Q, earnings release, or explicit margin/ROE ratio is in the sources; the margin and return ratios below are computed from S27.
- ✓ 3. 10-Q takeaways
Q3 2026 sales were $9,404 million, up 9% (5% underlying: 3% price, 2% volume), and adjusted operating profit rose 8% to $2,763 million, a 29.4% margin versus 29.7%. Reported results were hit by $425 million of cost reduction program and other charges taken in the quarter, cutting reported operating profit 9% and diluted EPS 11% to $3.66, against adjusted EPS of $4.59, up 9%. Nine-month operating cash flow was $7,680 million, buybacks $2,606 million and dividends $2,214 million; the earnings release gives numeric guidance of FY2026 adjusted EPS $17.82-$17.92 and capex $5.5-$6.0 billion.
- ✓ 4. Corporate governance
Filled; members read this box.
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ✓ 9. Insider trading interpretation
Filled; members read this box.
- ○ 10. Earnings-call notes
- ✓ 11. Impression of the shareholder letter
Filled; members read this box.
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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