Is Linde PLC (NASDAQ:LIN) the Best Chemical Stock to Buy in 2024?
We recently published a list of the Analyst Says These 10 Stocks Can Benefit if Donald Trump Wins US Election 2024. Since Linde PLC (NASDAQ:LIN) ranks 4th on the list, it deserves a deeper look.
Wolfe Research said in a note earlier this month that the odds have shifted in favor of Donald Trump following the first presidential debate. However, the firm believes we can see several “unexpected twists and turns” ahead. Wolfe Research also shared a list of stocks that could be potential winners should Donald Trump become the President of the US.
What could happen if Donald Trump becomes President of the US has been a topic of debate and discussion on Wall Street over the past several months. In late January, when the Russell 2000 index jumped, Zhiwei Ren, portfolio manager at Penn Mutual Asset Management, reportedly said that investors might be flocking to the “Trump Trade.” The Russell 2000 is a small-cap U.S. stock market index that makes up the smallest 2,000 stocks in the Russell 3000 Index. Ren said, according to Wall Street Journal, that since Trump is a supporter of low interest rates and less regulation, small-cap stocks, which thrive under Dovish economic policies, were reacting positively to the increasing chances of Donald Trump becoming the leading Republican candidate for the upcoming elections.
In this article, we first scanned Wolfe Research’s basket of stocks the firm believes could be potential winners in case of a Trump presidency. From these stocks we picked 10 companies with the highest number of hedge fund investors.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
An industrial complex with its towering smokestacks, showing the scale of the company's specialty chemicals operations.
Linde PLC (NASDAQ:LIN)
Number of Hedge Fund Investors: 65
Linde PLC (NASDAQ:LIN) is one of the notable chemical and industrial gas companies in the world. Linde PLC (NASDAQ:LIN) growth prospects are strong. For 2024, it expects adjusted EPS for the full year 2024 to range between $15.30 and $15.60, reflecting an 8% to 10% growth. This guidance aligns closely with the analyst’s annual EPS estimate of $15.52. Wall Street expects Linde PLC (NASDAQ:LIN) earnings growth to average over 11% per annum over the next five years. Average analyst price target on the stock set by Wall Street is $473, which presents a 9% upside potential from the current levels.
Linde PLC (NASDAQ:LIN) is benefiting from the global de-carbonization trend. As of the end of March this year, the company had $8.5 billion project backlog, set to convert into revenue over time. These high-quality projects, characterized by double-digit IRR, secure cash flow, and reputable customers, include over one-third related to clean energy.
Linde PLC (NASDAQ:LIN) talked about this trend during Q1 earnings call:
At the same time, we are seeing project backlog opportunities pick up for new low-carbon electric arc furnaces or EAF as well as existing steel customers exploring ways to reduce their carbon footprint. Linde has recently signed a long-term agreement with H2 Green Steel to supply industrial gases for the world’s first large-scale green steel production plant in Northern Sweden. In addition, Tier 1 producers like Baowu in China have expanded their relationship with Linde, by decaptivating their ASUs into our existing supply network further increasing supply reliability and efficiency.
Overall, Linde PLC (NASDAQ:LIN) ranks 4th on Insider Monkey’s list titled Analyst Says These 10 Stocks Can Benefit if Donald Trump Wins US Election 2024. While we acknowledge the potential of Linde PLC (NASDAQ:LIN), our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than Linde PLC (NASDAQ:LIN) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.