5 Best European Dividend Stocks to Buy Now

1. Linde Plc (NYSE:LIN)

No of HFs: 60

Total Value of HF Holdings: $3.55 Billion

The best European dividend stock to buy now is LIN. LIN has a dividend yield of 1.73%. At the end of September, a total of 60 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 15% from one quarter earlier. An insider recently purchased 3,400 share at around $160 in May 2020. The stock is up 54% since then. LIN was mentioned as one of the 10 Best Hydrogen Fuel Cell Stocks to Buy Now. In an article, VGI Partner mentioned that they believe a number of factors make the industrial gas industry an attractive investment

“Linde plc (NYSE: LIN) contributed +1.3% to performance for the twelve months to 30 June 2019, with the share price increasing 27.0% over the course of the year.

Linde plc is the result of a merger between two of the big four industrial gas providers, Praxair Inc. and Linde AG. The merger closed in March 2019 and the combined business, Linde plc, is now the largest industrial gas player in the world, further consolidating an already highly concentrated industrial gas industry.

We believe a number of factors make the industrial gas industry an attractive investment. The product is a fraction of their customers’ total cost base but an essential input, providing substantial pricing power. Industrial gas facilities require substantial initial capital requirements and often it will take three years to see any return on this investment. The industry has very long-term contracts with ‘Take or Pay’ provisions, improving earnings visibility. In addition, the industry has a highly consolidated market structure, with the top three players holding ~80% of the global market. Finally, the industry tends to form regional monopolies, as production must occur within 200km of the end customer.

We have been Praxair shareholders for many years as, in addition to the above factors, Praxair has a very high-quality, long term focused management team who are aligned with shareholders as a result of their substantial shareholding.

This Praxair management team is, as of March, in control of the merged business and we believe their best-in-class execution combined with Linde AG’s assets will result in significant pricing opportunities and margin improvement over the coming years.”

Please also see 10 Best Dividend Stocks For Passive Income and 10 Best Chemical Stocks to Buy For 2021.

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