UBS upgrades Linde to Buy, sees acceleration in earnings growth next year

Investing.com -- UBS upgraded Linde PLC to Buy from Neutral in a note on Tuesday, citing “quality at a discount” and a “defensive growth stock at an attractive risk/reward.”

Analyst Joshua Spector said the shares offer a “2.5x up/downside skew” and that an acceleration in earnings per share growth in 2026 should serve as a key catalyst.

“We believe the stock is at an attractive 2.5x up/downside skew, and we think an acceleration in EPS growth in 2026 will be a positive catalyst,” UBS wrote.

The firm added that Linde is “currently trading at ~10% discount to average, consistent with where the stock has been when investors have shown lower confidence in growth.”

UBS expects adjusted EPS growth to rise from about 6% in 2025 to “~9-10% Y/Y” in 2026, with further upside from new project startups.

“More backlog start-ups over 2026–27 helps by another 1–2%,” the analyst stated, forecasting adjusted EPS growth of roughly 9% next year and an 11% compound annual growth rate over the medium term.

The bank pointed to several tailwinds, including the lapping of weaker European volumes and recovering helium and rare gas pricing.

“We have confidence that LIN will get back to 10%+ EPS growth in the next year,” UBS wrote, noting that the company’s backlog of more than $7 billion supports “4–6% annual growth from base projects, backlog, and buybacks.”

UBS lowered its price target to $500 from $507, implying about 20% upside. “Price + productivity we think can still drive ~50bps of margin improvement a year,” Spector commented, reiterating confidence in Linde’s ability to deliver steady earnings and returns.

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