APD
Air Products and Chemicals, Inc.$276.35
Sell
Target $169.20
Report: Mar 08, 2026Basic Materials • Chemicals - Specialty • Asset-Based OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$276.35-38.8%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$169.20
(39% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$301.11
52 Week Low$229.11
Avg. 3 Month Volume1.50M
Efficiency
LTM Gross Margin31.6%
LTM EBITDA Margin11.3%
LTM EBIT Margin-1.5%
LTM Operating Margin-7.0%
LTM ROA-0.8%
LTM ROE-2.2%
LTM ROIC-0.4%
LTM ROCE-0.5%
Capital Structure
Market Cap (MM)$64.7B
Enterprise Value (MM)$81.8B
Shares Outstanding222.80M
Total Debt (MM)$18.14B
Cash & Equivalents (MM)$1.03B
LTM Net Debt (MM)$17.11B
LTM Net Debt/EBITDA12.4x
Growth
TTM Rev. Growth1.4%
Last 3-Yr Rev. CAGR-1.8%
Last 3-Yr EBITDA CAGR-31.2%
Last 3-Yr EPS CAGRN/A
Valuation
Street Target Price$291.50
LTM EV/Revenue6.7x
LTM EV/Gross Profit21.2x
LTM EV/EBIT-446.0x
LTM EV/EBITDA59.1x
LTM P/E-193.8x
LTM EV/FCF-29.1x
LTM P/FCF-23.0x
LTM P/TB1.6x
LTM P/B4.2x
Dividend Yield2.5%
Payout Ratio-474.2%
Executive SummarySituation: Current price is $276.35 versus fair value $169.2 (-38.8% expected return), and valuation confidence is stable. Debate: Bull case depends on Reduction of FY2026 CapEx to $4 billion. Bear case centers on Execution risk at the NEOM Green Hydrogen project. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
First-mover advantage in the global hydrogen economy with a $13.5 billion project backlog; long-term take-or-pay contracts provide a stable cash flow floor; new CEO Eduardo Menezes brings a proven track record of 550 bps margin expansion from Linde.
Bear Case
Extreme capital intensity with CapEx at 42% of revenue vs. 10% for peers; net debt-to-EBITDA has ballooned to 12.4x TTM; incremental ROIC of -65.9% indicates massive value destruction from recent investments.
Key Catalysts
Near-Term (0-6 months)Impact: High
Reduction of FY2026 CapEx to $4 billion. This addresses market concerns regarding the company's extreme capital intensity (currently 42% of...
Near-Term (0-6 months)Impact: Moderate
Divestiture of Asian coal gasification plants. Selling these non-core, underperforming assets would validate the 'back-to-basics' strategy a...
Long-Term (18+ months)Impact: Moderate
Air Products is at a critical juncture following its first GAAP loss in years and a total leadership overhaul. The stock's recent 6.4% jump...
Primary Risks
Concern: High
Execution risk at the NEOM Green Hydrogen project. As a first-of-its-kind mega-project, any delays in the 2027 ammonia production timeline w...
Concern: Medium
Persistent helium market weakness. Helium pricing pressure (down 1% globally) directly reduces high-margin merchant sales, acting as a 4% he...
Concern: Medium
The stewardship verdict is a 'Reset' following the activist victory. The Governance Outcome Tree suggests: 1. Status Quo is no longer an opt...
Recent Activity
2026-01-30SEC Filing (8-K)
+6.44%Air Products reported Q1 FY26 GAAP EPS of $3.04, up 10% from prior year.
2025-11-06SEC Filing (8-K)
+8.94%Air Products reported fiscal 2025 full-year GAAP loss per share of $1.74 and operating loss of $877 million, with adjusted EPS of $12.03 and adjusted operating income of $2.9 billion.
2025-02-07SEC Filing (8-K)
-5.39%Air Products reports Q1 FY25 GAAP EPS of $2.77, up 1% from prior year
2024-08-01SEC Filing (8-K)
+8.95%Air Products reports Q3 FY24 GAAP EPS of $3.13, up 17% from prior year
2023-11-07SEC Filing (8-K)
-12.65%Air Products reported Q4 FY23 GAAP EPS of $3.08, up 20% from prior year, with adjusted EPS of $3.15, up 11%
Valuation Table
9.8/10Decision Grade
Scenario Range
$14
Bear
$161
Base
$242
Bull
$276