Bank of America has upgraded Air Liquide to a Buy rating from Underperform and set a new price target of €200 per share, up from €159, arguing the industrial gases company’s prospects in semiconductor-related Electronics work are not fully priced in by investors.
Shares of Air Liquide were higher in Paris trading, rising 1.7% by 08:34 ET (12:34 GMT).
In a research note led by John Campbell, the bank’s analysts said their earlier caution - which had been driven by a slowdown in energy-transition investment - has been confirmed by project delays in that area. Despite this, the team highlighted Air Liquide’s recent success in securing Electronics contracts and building a record backlog in that franchise.
Electronics currently represent only about 10% of Air Liquide’s sales, the note says, but account for roughly 40% of the company’s investment backlog. BofA projects the Electronics business will expand organically at about 14% during 2026-2030, which the bank says is roughly double the growth rate implicitly assumed in consensus estimates.
The report emphasises the multi-year cadence of semiconductor fabrication plant construction and cautions that the immediate impact of the Electronics backlog is likely to be more visible in later years. Nevertheless, the analysts argue the market should increasingly recognise the improved visibility that comes from contractual, multi-year projects and the potential for above-average margins as the Electronics business scales.
BofA’s semiconductor team forecasts that global chip capital expenditure will rise from approximately $190 billion in 2025 to $370 billion by 2030. The bank estimates that Electronics will contribute around 40% of Air Liquide’s projected 4.5% group organic growth in 2027, and expects the segment to be margin-accretive as it grows.
The note also cites recent commentary from chipmakers that supports a tight supply backdrop in the market. Micron, on a recent earnings call, said it expects in the medium term to be "only able to meet about 50% to two-thirds" of demand from several key customers. BofA’s analysts pointed to Micron’s expansion of multi-year, take-or-pay contracts, saying those arrangements improve visibility and reduce volatility for suppliers such as Air Liquide.
This assessment from Bank of America reframes Air Liquide’s near-term outlook by placing greater emphasis on Electronics-driven demand and the contractual nature of that work, while acknowledging that the firm’s previous caution around energy-transition project delays remains valid.