Linde plc (NASDAQ:LIN)

The valuation ratios exhibit a divergent trend between earnings-based multiples and asset- or revenue-based multiples over the analyzed period from March 2022 through March 2026. While multiples related to profitability have generally compressed, the premiums attributed to sales and book value have expanded.

Price to Earnings (P/E) and Price to Operating Profit (P/OP)

A general downward trajectory is observed in both the P/E and P/OP ratios. The P/E ratio began at 39.22 in March 2022, peaked at 41.67 in June 2022, and subsequently trended lower, reaching a period low of 27.54 in September 2025 before stabilizing in the 33.00 range by March 2026. Similarly, the P/OP ratio declined from an initial 30.03 to a low of 21.29 in September 2025. This contraction suggests a reduction in the multiple the market is willing to pay for each unit of earnings and operating profit over the multi-year period.

Price to Sales (P/S)

The P/S ratio demonstrates an overall upward trend, contrasting with the earnings multiples. After an initial dip to 4.29 in September 2022, the ratio rose steadily, crossing the 6.00 threshold in early 2024 and peaking at 6.93 in December 2025. The ratio concluded the period at 6.78 in March 2026, indicating that the market has assigned a higher valuation to the company's revenue stream over time.

Price to Book Value (P/BV)

The P/BV ratio shows the most consistent growth among the observed metrics. Starting at 3.67 in March 2022, the ratio climbed steadily with few interruptions, surpassing 5.00 by June 2024 and reaching a peak of 6.16 in December 2025. This sustained increase reflects a growing premium over the company's net asset value, ending the period at 6.09 in March 2026.

The combination of declining P/E and P/OP ratios alongside rising P/S and P/BV ratios indicates a shift in valuation dynamics. The market has moved toward a higher valuation of the company's top-line revenue and balance sheet assets, even as the multiples applied to bottom-line profitability have compressed.

The valuation trajectory from March 2022 through March 2026 is characterized by significant growth in both equity price and earnings per share, leading to a general compression of the Price-to-Earnings (P/E) ratio over the analyzed period.

Share Price Performance

The share price exhibited a long-term upward trend, ascending from 313.29 US$ in March 2022 to a peak of 508.27 US$ in December 2025. Following a period of relative stability in 2022, a sustained growth phase occurred throughout 2023 and 2024, with the price crossing the 400 US$ threshold in March 2024 and remaining above that level through March 2026.

Earnings Per Share (EPS) Growth

EPS demonstrated consistent and robust expansion, increasing from 7.99 US$ in March 2022 to 15.31 US$ by March 2026. A notable acceleration in profitability was observed between March 2023 and June 2023, where EPS rose from 9.16 US$ to 11.67 US$. This steady upward trajectory indicates a strong growth in fundamental earnings capacity over the four-year span.

P/E Ratio Dynamics

The P/E ratio experienced a general trend of contraction, reflecting a valuation that became more grounded in earnings growth. The ratio peaked at 41.67 in June 2022 but shifted toward a lower range of 30 to 35 throughout 2023 and 2024. A period low of 27.54 was reached in September 2025, followed by a recovery to 33.18 by March 2026. This compression suggests that the increase in EPS outpaced the increase in share price for a significant portion of the period, effectively reducing the valuation premium.

The financial period between March 31, 2022, and March 31, 2026, is characterized by a consistent expansion in operational profitability and a general increase in equity value, accompanied by a gradual compression of the Price to Operating Profit (P/OP) valuation multiple.

Share Price Trends

The share price exhibited a strong long-term upward trajectory, rising from 313.29 US$ in March 2022 to 507.92 US$ by March 2026. While there were periods of volatility—notably a dip in mid-2022 and a correction in September 2025—the overall trend reflects significant capital appreciation, with the price peaking at 508.27 US$ in September 2025.

Operating Profit per Share Performance

Operating profit per share demonstrated steady and uninterrupted growth throughout the observed timeframe. Starting at 10.43 US$ in March 2022, the figure climbed to 19.84 US$ by March 2026. This represents a near-doubling of operational efficiency per share, showing a consistent quarterly increase that suggests strong fundamental growth in core business operations.

Price to Operating Profit (P/OP) Analysis

The P/OP ratio underwent a noticeable downward trend, signaling a valuation compression. In the first year, the ratio fluctuated between 28.89 and 31.93. However, from June 2023 onward, the ratio generally declined, reaching a low of 21.29 in September 2025 before stabilizing around 25.60 by March 2026. This contraction indicates that while the share price increased, the growth in operating profit per share outpaced the growth in the stock price, resulting in a more conservative valuation multiple over time.

In summary, the divergence between the rising share price and the falling P/OP ratio highlights that the increase in market valuation was driven more by actual improvements in operating profitability than by an expansion of the valuation multiple. The company transitioned from a higher valuation multiple in 2022 to a lower, more fundamentally supported multiple by 2026.

The valuation metrics indicate a general expansion of the Price-to-Sales (P/S) ratio between March 2022 and March 2026, characterized by a transition from a lower valuation base to a higher sustained multiple.

Price-to-Sales Ratio Trends

The P/S ratio exhibited a cyclical pattern, initially declining from 4.96 in March 2022 to a period low of 4.29 in September 2022. Following this trough, the ratio entered a growth phase, surpassing 6.00 by December 2023 and remaining largely within the 6.16 to 6.61 range through the end of 2024. A final peak of 6.93 was recorded in December 2025, before settling at 6.78 in March 2026.

Sales per Share Growth

Sales per share showed a consistent and incremental upward trajectory throughout the analyzed period. Starting at 63.11 in March 2022, the figure rose steadily to 74.91 by March 2026. This progression suggests a stable increase in revenue generation per share, providing a consistent fundamental base for the stock's valuation.

Share Price Influence

The expansion of the P/S ratio is primarily attributable to share price appreciation, which outpaced the growth rate of sales. The share price increased from 313.29 in March 2022 to 507.92 in March 2026. Significant valuation increases occurred when share prices rose sharply relative to the linear growth of sales per share, most notably during the climb toward 451.20 in December 2023 and the subsequent peaks above 500.00 in late 2025 and early 2026.

Overall, the divergence between the linear growth of sales per share and the more aggressive growth of the share price has resulted in a higher valuation multiple, reflecting an increase in the market premium attributed to each dollar of revenue.

The Price to Book Value (P/BV) ratio exhibits a consistent upward trajectory over the analyzed period from March 31, 2022, to March 31, 2026. Starting at 3.67, the ratio climbed to 6.09 by the end of the period, indicating a significant expansion in the market's valuation of the company relative to its accounting book value.

Share Price Appreciation

A sustained increase in the share price is the primary driver of the rising P/BV ratio. The price rose from 313.29 US$ in March 2022 to a peak of 508.27 US$ in December 2025, before stabilizing at 507.92 US$ in March 2026. This represents a substantial growth in market capitalization over the four-year span.

Book Value per Share (BVPS) Stability

In contrast to the share price, the Book Value per Share remained relatively stagnant. BVPS fluctuated within a narrow range, reaching a low of 76.11 US$ in September 2022 and ending at 83.37 US$ in March 2026. The lack of significant growth in the underlying book value indicates that the increase in the P/BV ratio is not attributed to an increase in net asset value, but rather to increased investor confidence or higher premiums assigned to the company's intangible assets and future earnings potential.

P/BV Ratio Progression

The ratio experienced steady growth across several phases. Between March 2022 and December 2022, the ratio rose from 3.67 to 4.28. A more pronounced acceleration occurred throughout 2023, reaching 5.47 by year-end. Despite minor fluctuations in 2024 and early 2025, the ratio reached its peak of 6.16 in December 2025, reflecting a market valuation more than six times the accounting value of the shares.

The divergence between the stagnant book value and the aggressively climbing share price suggests a transition toward a higher valuation multiple. The increasing P/BV ratio indicates that the market is placing a higher premium on the company's ability to generate returns above its tangible asset base.