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Why Is Linde (LIN) Up 6.2% Since Last Earnings Report?
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It has been about a month since the last earnings report for Linde (LIN - Free Report) . Shares have added about 6.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Linde due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Linde Beats Q4 Earnings Estimates, Hikes Capex Outlook
Linde has reported fourth-quarter 2022 adjusted earnings from continuing operations of $3.16 per share, surpassing the Zacks Consensus Estimate of $2.91. The bottom line improved from the year-ago quarter’s profit of $2.77.
Total quarterly revenues of $7,899 million missed the Zacks Consensus Estimate of $8,087 million. The top line also declined from the year-ago quarter’s $8,298 million.
Strong quarterly earnings were driven by increased prices and volumes across all end markets.
Segmental Highlights
The operating profit of Linde in the Americas segment was up 12% year over year to $944 million on higher pricing and stable volumes, aided by all end markets.
Linde’s profit in the EMEA segment increased 7.2% year over year to $509 million due to higher pricing.
Profit in the APAC segment increased 9.5% year over year to $416 million on an uptick in prices and volumes, primarily in the electronics, chemicals and energy end markets, including project start-ups.
Operating profit in the Engineering segment increased to $157 million from the prior year’s $150 million.
Backlogs
At the end of the fourth quarter, the company’s high-quality backlog was $9 billion, comprising a sale-of-gas backlog of $5.7 billion.
Capital Investment & Balance Sheet
Linde reported capital expenditure of $936 million for the December-end quarter. The company ended the quarter with cash and cash equivalents of $5.4 billion. Linde’s long-term debt was $12.2 billion.
Guidance
For the December-end quarter, Linde projects adjusted earnings per share between $3.05 and $3.15. For 2023, it expects adjusted earnings per share of $13.15-$13.55.
The company expects capital expenditure of $3.5-$4 billion for the year, indicating an increase from the $3.2 billion reported in 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
Currently, Linde has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Linde has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Linde (LIN) Up 6.2% Since Last Earnings Report?
It has been about a month since the last earnings report for Linde (LIN - Free Report) . Shares have added about 6.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Linde due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Linde Beats Q4 Earnings Estimates, Hikes Capex Outlook
Linde has reported fourth-quarter 2022 adjusted earnings from continuing operations of $3.16 per share, surpassing the Zacks Consensus Estimate of $2.91. The bottom line improved from the year-ago quarter’s profit of $2.77.
Total quarterly revenues of $7,899 million missed the Zacks Consensus Estimate of $8,087 million. The top line also declined from the year-ago quarter’s $8,298 million.
Strong quarterly earnings were driven by increased prices and volumes across all end markets.
Segmental Highlights
The operating profit of Linde in the Americas segment was up 12% year over year to $944 million on higher pricing and stable volumes, aided by all end markets.
Linde’s profit in the EMEA segment increased 7.2% year over year to $509 million due to higher pricing.
Profit in the APAC segment increased 9.5% year over year to $416 million on an uptick in prices and volumes, primarily in the electronics, chemicals and energy end markets, including project start-ups.
Operating profit in the Engineering segment increased to $157 million from the prior year’s $150 million.
Backlogs
At the end of the fourth quarter, the company’s high-quality backlog was $9 billion, comprising a sale-of-gas backlog of $5.7 billion.
Capital Investment & Balance Sheet
Linde reported capital expenditure of $936 million for the December-end quarter. The company ended the quarter with cash and cash equivalents of $5.4 billion. Linde’s long-term debt was $12.2 billion.
Guidance
For the December-end quarter, Linde projects adjusted earnings per share between $3.05 and $3.15. For 2023, it expects adjusted earnings per share of $13.15-$13.55.
The company expects capital expenditure of $3.5-$4 billion for the year, indicating an increase from the $3.2 billion reported in 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
Currently, Linde has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Linde has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.