An unusual derivative play off SpaceX’s IPO success: A maker of space gases

§ 01 Executive Snapshot

• What: Linde is positioned to benefit from the anticipated IPO and growth of SpaceX.
• Who: Linde, Rothschild & Co., Analyst Tony Jones, SpaceX.
• Why it matters: The growth of the space transportation industry presents a significant opportunity for Linde, potentially leading to increased revenues and market valuation.

§ 02 Key Developments

• Rothschild & Co. reiterated a buy rating on Linde and raised its price target to $560 from $550.
• Linde shares have surged 20% this year, closing at $515.59 on Tuesday.
• Analyst Tony Jones forecasts an additional 9% increase in Linde's stock price based on updated projections.
• Linde has been a supplier for NASA for around 60 years, establishing a strong foothold in the space industry.
• Revenue per launch for Linde could rise to nearly $6 million by 2028, up from under $4 million in 2025.

§ 03 Strategic Context

• The space transportation industry is evolving, with SpaceX's IPO representing a major milestone and growth opportunity for related sectors.
• Linde's longstanding relationships with NASA and emerging space companies position it favorably in a niche market with high barriers to entry.

§ 04 Strategic Implications

• Immediate implications include potential contracts and a revised backlog for Linde, which could enhance its earnings and valuation.
• Long-term implications suggest that as space transportation expands, Linde could see exponential growth in demand for its industrial gases.

§ 05 Risks & Constraints

• Potential risks include regulatory challenges or shifts in the space industry that could impact demand for industrial gases.
• Competition from other industrial gas suppliers could pose a threat, particularly if new entrants gain access to the space market.

§ 06 Watchlist / Forward Signals

• Key upcoming milestones include the IPO of SpaceX and developments related to the Starship launch vehicle.
• Future contracts and demand for Linde’s services in the space sector will be critical indicators of its success in this emerging market.