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Shares in ​Air Liquide rose as much as 4.2% on Tuesday after sources ‌familiar with the matter said activist investor Elliott Investment Management had built a stake in the French industrial gases company.

L'Air Liquide S.A. exemplifies a high-quality, fundamentally safe industrial gas leader, but its valuation is unjustifiably rich versus operational realities. AIQUF trades at 29-31x P/E and 15-16x EV/EBITDA, despite modest 5-7% growth, restrained FCF, and lower ROIC than Linde. Current premium reflects overhyped expectations for hydrogen and electronics; actual returns remain single-digit and cyclicality risks…

The company remains confident it can increase its operating margin and deliver recurring net profit growth at constant exchange rates.

Air Liquide confirmed ‌its margin outlook on Tuesday after first-half operating earnings broadly met expectations, as growth in electronics and industrial gases ​helped offset a still-muted industrial backdrop.

Air Liquide is reaffirmed as a buy, supported by margin expansion and a robust €5.5 billion investment backlog. AIQUF's Q1 group sales grew 1.9%, with US structural drivers offsetting softness in the EU and Asia; the electronics segment posted 9% growth. Internal simplification initiatives and productivity measures suggest further gains are increasingly driven by execution rather than external factors.