BofA: Air Liquide — Putting the 'Air' in AI
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BofA double-upgrades Air Liquide from Underperform to Buy, raising the target price from EUR 159 to EUR 200, implying roughly 15% upside. The firm believes the company's success in securing electronics projects has driven its order backlog to a record high, despite energy transition delays.
Electronics currently represents only about 10% of sales, yet AI-driven semiconductor capex accounts for approximately 40% of the investment backlog. The recent DIG acquisition further strengthens this trajectory. Analysts project electronics organic growth of around 14% for 2026-2030E, double the consensus estimate. This segment is expected to contribute 40% of the group's roughly 4.5% organic growth in fiscal 2027.
BofA's semiconductor team forecasts industry capex will expand from roughly $190 billion in 2025 to approximately $370 billion by 2030, growing 15% annually. Near-term opportunities include Micron's second Idaho fab. The valuation premium has compressed from 2023-24 highs to about 70% relative to the Stoxx 600. EPS estimates are modestly higher at EUR 6.35, EUR 7.06, and EUR 7.71 for 2026E, 2027E, and 2028E respectively, with EBIT forecasts exceeding Visible Alpha consensus by 2-5% through 2030.
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