CHART INDUSTRIES, INC. (GTLS): what the price requires

At today's price, CHART INDUSTRIES, INC. (GTLS) is priced for today's economics sustained for ~10.2 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-19 · Source: https://boothcheck.com/report/GTLS

Headline

FieldValue
TickerGTLS
CompanyCHART INDUSTRIES, INC.
Current price$209.97/sh
CompositionCryo Tank Solutions 15% / Heat Transfer Systems 29% / Specialty Products 26% / Repair, Service & Leasing 31%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin needed4.8%
Operating margin today7.0%
Margin compression implied-2.2pp
Must persist for10.2y
Multiple paid47x operating income

The operating-margin requirement is derived from the framework's value band at year 6, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 9.7% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~2.1 years.

How unusual the bet is: high

ReferenceValue
vs own history+0.13σ
cohort percentile (of 225 peers)88
sustained it ~10 years at this level14%
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple; asset-based/growth-DCF land below the price.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset3.36x2expensive
Earnings—0—
Relative0.97x3justifies
Growth2.00x2expensive

Families that justify the price: Relative Families that call it expensive: Asset, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.1%); the inversion above states its own rate.

Per-Model Detail (n=7)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$0.00—noFCF base $0.0B, growth -2% (input: historical growth), terminal g 0.5%, WACC 7.1%, 5yr projection
DCF Exit MultipleGrowth$111.621.88xyesExit EV/EBITDA: 4.0x / 4.4x / 6.4x (bear / base = today's held flat / bull), 5yr
Relative ValuationRelative$216.680.97xyesP/S fallback (negative EPS): Sector P/S 2.5x × TTM revenue — excluded from consensus
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$65.983.18xyesReference only (book value floor): BV/sh $65.98, ROE negative
Two-Stage Excess ReturnAsset$59.383.54xyesReference only (book value with convergence): BV/sh $65.98, ROE converges to ke
Discounted Future Market CapGrowth$98.952.12xyesRev $4.1B, growth -2% (input: historical growth; tapered), Terminal P/S: 2.1x / 2.4x / 2.8x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$0.00—noNegative/zero EPS — earnings-based value floored at $0
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$2.4984.33xyesNormalized EBIT (5y avg op income, one-time charges added back) $0.34B × (1−21%) / WACC 7.1% → EPV (no growth) (excluded from median)
Residual IncomeAsset——no—
Graham NumberAsset——no—
EV/EBITDA RelativeRelative$699.610.30xyesEBITDA $3.09B × sector EV/EBITDA 12.0x
FCF YieldEarnings$0.0120997.00xyesFCF $10.1M / Kₑ 9.3% — zero-growth perpetuity (excluded from median)
SBC-Adj FCF YieldEarnings——no—
Ben Graham FormulaEarnings——no—
ROIC-Justified P/BAsset$5.7236.71xyesBV $65.98 × (ROIC 0.6% / WACC 7.1%) (excluded from median)
P/Sales SectorRelative$216.680.97xyesRevenue $4.15B × sector P/S 2.5x
PEG Fair ValueRelative——no—
Earnings YieldEarnings——no—
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$3.5b
Net debt / NOPAT (after-tax)15.71x
Net debt / operating income (pre-tax)12.41x
Interest coverage0.9x
Share count CAGR (dilution)4.1%
Burning cashno

Bullet Takeaways

Bull Case

The most surprising thing in the data is how little the standalone valuation matters here. Chart trades at $208.29, and there is a binding merger agreement under which each share converts into the right to receive $210.00 in cash from Baker Hughes. Shareholders approved the deal in October 2025, and the company now guides to a July 2026 close pending European Commission and other regulatory approvals. So the bull case is not really about cryogenic equipment economics. It is about whether a $13.6B all-cash deal that has already cleared its shareholder vote also clears antitrust, with the EC review formally submitted and a decision deadline late in June. At an 0.8% spread to the $210 price, the market is assigning high probability to that outcome, and the holder is underwriting deal certainty, not terminal growth.

Beneath the deal, the franchise Baker Hughes is paying for is a broad cryogenic and gas-processing platform. The FY2025 10-K describes products that span the entire spectrum of industrial gas demand from small customers requiring cryogenic packaged gases to large users requiring custom engineered cryogenic storage, and a Heat Transfer Systems segment that supplies mission critical engineered equipment and systems used in the recovery, separation, liquefaction, and purification of hydrocarbons, LNG and industrial gases (accession 0000892553-26-000027). That is exactly the energy-and-industrial technology footprint the acquirer cited as its strategic rationale, and it explains why a strategic buyer is willing to pay a price the standalone DCF families do not support.

The order book gives the platform durability that the trailing income statement understates. The 10-K reports consolidated revenue climbing to $5,886.2M from $4,845.1M, and Chart's Q1 2026 release put remaining performance obligations at $6,282.9M, up more than a billion dollars year over year. Management also frames a structural demand tailwind, noting that continuing efforts by petroleum producing countries to better utilize stranded natural gas and associated gases which historically had been flared present a promising source of demand (accession 0000892553-26-000027). For an acquirer underwriting multi-year synergy, a backlog of that size against a single-digit-billion revenue base is the asset, and it is why the price clears the relative-multiple test even as the asset-based and growth-DCF families read expensive.

Bear Case

Strip out the merger and the standalone bear case is about a cyclical capital-goods business priced near a cycle peak while its current earnings sag. Trailing operating income of roughly $259M against a price implying about 32x company-wide operating income is only defensible if growth holds at a high rate for years, and the inversion shows the stretch is in duration, about seven years of sustained performance, not the near-term rate. Only about a fifth of comparable fast-growers have sustained that pace that long. If the Baker Hughes deal were to break, the share would not fall back to a fair multiple of depressed earnings, it would fall to whatever a leveraged, margin-compressed cyclical is worth without a strategic bid underneath it.

The leverage is the part that makes a broken deal dangerous rather than merely disappointing. Net debt sits near $3.5B, total debt around $3.8B, and trailing operating income covers interest only about 0.9 times, so the business is not comfortably self-funding its capital structure on current results. Q1 2026 made the point in real time: net income swung to a loss of $17.1M from a $42.7M profit a year earlier, gross margin fell from 33.9% to 28.4%, operating income dropped by $99.7M, and cash used in operations ballooned to $248.0M as working capital drained, leaving cash and equivalents at $269.4M. A company carrying that much debt cannot run negative operating cash flow indefinitely without the deal proceeds or a refinancing the bear case cannot assume.

The asset-based and growth-DCF reads agree on the direction. Book value per share is about $66, the excess-return models land between $59 and $66 because return on equity is negative, and the earnings-power and FCF-yield approaches collapse toward zero on a trailing loss. The order book is genuine, but the FY2025 10-K also reports a Cryo Tank Solutions segment whose 2025 orders of $587.8M were essentially flat against $582.9M the prior year (accession 0000892553-26-000027), so not every segment is compounding. Backlog converts to revenue only if margins normalize, and Q1 says margins are moving the wrong way. The bear holds that the price is borrowing almost all of its support from a deal that regulators have not yet cleared.

Valuation

The X-ray says the price is justified by relative multiples while the asset-based and growth-DCF families call it expensive, and that split is the whole story. The growth-DCF family is below the price, with the DCF exit-multiple model near $111 and the discounted-future-market-cap read near $98, both anchored to revenue that contracted modestly and margins that compressed. The asset family is lowest, with book value per share around $66 (accession 0000892553-26-000027 reports the segment and balance-sheet detail) and the excess-return models clustered between $59 and $66 because trailing return on equity is negative.

None of that is the operative number, because the operative number is the $210.00 cash consideration in the merger agreement. The standalone inversion, that the price embeds roughly 32x operating income and about seven years of sustained high growth, is what a buyer would underwrite if Chart stayed public, and on those terms the price is a demanding bet. But the price is not making that bet. At $208.29 it is making a much narrower one: that the Baker Hughes deal closes near its July 2026 target at $210 cash. The gap between the standalone DCF families in the $98 to $111 range and the quoted price measures how much of today's value is the takeout premium rather than the discounted cash the business generates on its own.

The practical read is that valuation here is a probability statement on regulatory approval, not a multiple. If the European Commission clears the transaction by its late-June deadline and the deal closes at $210, the remaining upside is the thin arbitrage spread plus the time value of a few weeks. If the deal breaks on antitrust grounds, the relevant anchor reverts to the standalone families, where the asset and growth-DCF reads sit well below the current quote, against a balance sheet carrying interest coverage near one. The asymmetry is wide, and it is set by clearance risk, not by where the cash flows would otherwise discount.

Catalysts

Peer Cohorts (Per Segment, With Filing Citations)

Cryo Tank Solutions (reported)

Heat Transfer Systems (reported)

Specialty Products (reported)

Repair, Service & Leasing (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

View the full interactive GTLS report on boothcheck