ECOLAB INC (ECL) Stock Fundamental Analysis
NYSE:ECL - New York Stock Exchange, Inc. - US2788651006 - Common Stock - Currency: USD
Overall ECL gets a fundamental rating of 6 out of 10. We evaluated ECL against 85 industry peers in the Chemicals industry. While ECL belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. While showing a medium growth rate, ECL is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year ECL was profitable.
ECL had a positive operating cash flow in the past year.
ECL had positive earnings in 4 of the past 5 years.
Each year in the past 5 years ECL had a positive operating cash flow.
1.2 Ratios
ECL has a Return On Assets of 9.44%. This is amongst the best in the industry. ECL outperforms 92.94% of its industry peers.
ECL's Return On Equity of 24.12% is amongst the best of the industry. ECL outperforms 95.29% of its industry peers.
ECL has a Return On Invested Capital of 12.07%. This is amongst the best in the industry. ECL outperforms 91.76% of its industry peers.
ECL had an Average Return On Invested Capital over the past 3 years of 10.09%. This is above the industry average of 7.01%.
The 3 year average ROIC (10.09%) for ECL is below the current ROIC(12.07%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.44% | ||
| ROE | 24.12% | ||
| ROIC | 12.07% |
ROA(3y)6.93%
ROA(5y)3.9%
ROE(3y)18.76%
ROE(5y)10.47%
ROIC(3y)10.09%
ROIC(5y)9.38%
1.3 Margins
With an excellent Profit Margin value of 13.42%, ECL belongs to the best of the industry, outperforming 94.12% of the companies in the same industry.
ECL's Profit Margin has improved in the last couple of years.
The Operating Margin of ECL (16.64%) is better than 87.06% of its industry peers.
In the last couple of years the Operating Margin of ECL has grown nicely.
The Gross Margin of ECL (43.50%) is better than 89.41% of its industry peers.
ECL's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.64% | ||
| PM (TTM) | 13.42% | ||
| GM | 43.5% |
OM growth 3Y5.67%
OM growth 5Y2.23%
PM growth 3Y14.78%
PM growth 5Y5.11%
GM growth 3Y2.05%
GM growth 5Y0.87%
2. Health
2.1 Basic Checks
ECL has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, ECL has less shares outstanding
ECL has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ECL has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.86 indicates that ECL is not in any danger for bankruptcy at the moment.
The Altman-Z score of ECL (4.86) is better than 95.29% of its industry peers.
The Debt to FCF ratio of ECL is 4.16, which is a neutral value as it means it would take ECL, 4.16 years of fcf income to pay off all of its debts.
ECL's Debt to FCF ratio of 4.16 is amongst the best of the industry. ECL outperforms 82.35% of its industry peers.
ECL has a Debt/Equity ratio of 0.79. This is a neutral value indicating ECL is somewhat dependend on debt financing.
The Debt to Equity ratio of ECL (0.79) is worse than 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 4.16 | ||
| Altman-Z | 4.86 |
ROIC/WACC1.44
WACC8.41%
2.3 Liquidity
A Current Ratio of 1.26 indicates that ECL should not have too much problems paying its short term obligations.
ECL's Current ratio of 1.26 is on the low side compared to the rest of the industry. ECL is outperformed by 76.47% of its industry peers.
A Quick Ratio of 0.95 indicates that ECL may have some problems paying its short term obligations.
ECL's Quick ratio of 0.95 is in line compared to the rest of the industry. ECL outperforms 42.35% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.26 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
ECL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 27.83%, which is quite impressive.
Measured over the past 5 years, ECL shows a small growth in Earnings Per Share. The EPS has been growing by 2.73% on average per year.
ECL shows a small growth in Revenue. In the last year, the Revenue has grown by 2.75%.
ECL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.10% yearly.
EPS 1Y (TTM)27.83%
EPS 3Y11.38%
EPS 5Y2.73%
EPS Q2Q%16.77%
Revenue 1Y (TTM)2.75%
Revenue growth 3Y7.33%
Revenue growth 5Y1.1%
Sales Q2Q%1.7%
3.2 Future
The Earnings Per Share is expected to grow by 10.68% on average over the next years. This is quite good.
ECL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.69% yearly.
EPS Next Y13.8%
EPS Next 2Y13.06%
EPS Next 3Y13.94%
EPS Next 5Y10.68%
Revenue Next Year1.36%
Revenue Next 2Y3.3%
Revenue Next 3Y4.14%
Revenue Next 5Y4.69%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 35.85 indicates a quite expensive valuation of ECL.
62.35% of the companies in the same industry are cheaper than ECL, based on the Price/Earnings ratio.
ECL is valuated rather expensively when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
ECL is valuated quite expensively with a Price/Forward Earnings ratio of 31.50.
Based on the Price/Forward Earnings ratio, ECL is valued a bit more expensive than the industry average as 62.35% of the companies are valued more cheaply.
ECL is valuated rather expensively when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.85 | ||
| Fwd PE | 31.5 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ECL is valued a bit more expensive than 72.94% of the companies in the same industry.
ECL's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.22 | ||
| EV/EBITDA | 20.82 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ECL does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of ECL may justify a higher PE ratio.
ECL's earnings are expected to grow with 13.94% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.6
PEG (5Y)13.12
EPS Next 2Y13.06%
EPS Next 3Y13.94%
5. Dividend
5.1 Amount
ECL has a Yearly Dividend Yield of 1.09%.
ECL's Dividend Yield is comparable with the industry average which is at 4.02.
With a Dividend Yield of 1.09, ECL pays less dividend than the S&P500 average, which is at 2.52.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.09% |
5.2 History
The dividend of ECL has a limited annual growth rate of 3.93%.
ECL has paid a dividend for at least 10 years, which is a reliable track record.
ECL has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.93%
Div Incr Years33
Div Non Decr Years33
5.3 Sustainability
ECL pays out 31.45% of its income as dividend. This is a sustainable payout ratio.
ECL's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP31.45%
EPS Next 2Y13.06%
EPS Next 3Y13.94%
238.73
+2.77 (+1.17%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners81.39%
Inst Owner Change0.99%
Ins Owners0.11%
Ins Owner Change1.57%
Market Cap67.71B
Analysts74.84
Price Target294.13 (23.21%)
Short Float %0.74%
Short Ratio1.55
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.09% |
Yearly Dividend2.34
Dividend Growth(5Y)3.93%
DP31.45%
Div Incr Years33
Div Non Decr Years33
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.14%
Min EPS beat(2)-0.66%
Max EPS beat(2)0.38%
EPS beat(4)1
Avg EPS beat(4)-0.36%
Min EPS beat(4)-0.66%
Max EPS beat(4)0.38%
EPS beat(8)4
Avg EPS beat(8)0.1%
EPS beat(12)5
Avg EPS beat(12)-0.18%
EPS beat(16)8
Avg EPS beat(16)0.8%
Revenue beat(2)0
Avg Revenue beat(2)-1.21%
Min Revenue beat(2)-1.93%
Max Revenue beat(2)-0.49%
Revenue beat(4)0
Avg Revenue beat(4)-1.34%
Min Revenue beat(4)-2.04%
Max Revenue beat(4)-0.49%
Revenue beat(8)1
Avg Revenue beat(8)-0.98%
Revenue beat(12)3
Avg Revenue beat(12)-0.66%
Revenue beat(16)6
Avg Revenue beat(16)-0.43%
PT rev (1m)0.11%
PT rev (3m)3.35%
EPS NQ rev (1m)-0.49%
EPS NQ rev (3m)-1.09%
EPS NY rev (1m)-0.49%
EPS NY rev (3m)0.03%
Revenue NQ rev (1m)-0.77%
Revenue NQ rev (3m)-3.39%
Revenue NY rev (1m)-0.14%
Revenue NY rev (3m)-2.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.85 | ||
| Fwd PE | 31.5 | ||
| P/S | 4.3 | ||
| P/FCF | 37.22 | ||
| P/OCF | 24.06 | ||
| P/B | 7.73 | ||
| P/tB | N/A | ||
| EV/EBITDA | 20.82 |
EPS(TTM)6.66
EY2.79%
EPS(NY)7.58
Fwd EY3.17%
FCF(TTM)6.41
FCFY2.69%
OCF(TTM)9.92
OCFY4.16%
SpS55.5
BVpS30.88
TBVpS-8.67
PEG (NY)2.6
PEG (5Y)13.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.44% | ||
| ROE | 24.12% | ||
| ROCE | 14.88% | ||
| ROIC | 12.07% | ||
| ROICexc | 13% | ||
| ROICexgc | 41.45% | ||
| OM | 16.64% | ||
| PM (TTM) | 13.42% | ||
| GM | 43.5% | ||
| FCFM | 11.56% |
ROA(3y)6.93%
ROA(5y)3.9%
ROE(3y)18.76%
ROE(5y)10.47%
ROIC(3y)10.09%
ROIC(5y)9.38%
ROICexc(3y)10.68%
ROICexc(5y)9.93%
ROICexgc(3y)35.11%
ROICexgc(5y)31.71%
ROCE(3y)12.44%
ROCE(5y)11.62%
ROICexcg growth 3Y15.5%
ROICexcg growth 5Y7.38%
ROICexc growth 3Y16.48%
ROICexc growth 5Y4.33%
OM growth 3Y5.67%
OM growth 5Y2.23%
PM growth 3Y14.78%
PM growth 5Y5.11%
GM growth 3Y2.05%
GM growth 5Y0.87%
F-Score8
Asset Turnover0.7
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 4.16 | ||
| Debt/EBITDA | 1.96 | ||
| Cap/Depr | 106.32% | ||
| Cap/Sales | 6.32% | ||
| Interest Coverage | 7.64 | ||
| Cash Conversion | 79.17% | ||
| Profit Quality | 86.13% | ||
| Current Ratio | 1.26 | ||
| Quick Ratio | 0.95 | ||
| Altman-Z | 4.86 |
F-Score8
WACC8.41%
ROIC/WACC1.44
Cap/Depr(3y)88.71%
Cap/Depr(5y)80.52%
Cap/Sales(3y)5.47%
Cap/Sales(5y)5.12%
Profit Quality(3y)101.32%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)27.83%
EPS 3Y11.38%
EPS 5Y2.73%
EPS Q2Q%16.77%
EPS Next Y13.8%
EPS Next 2Y13.06%
EPS Next 3Y13.94%
EPS Next 5Y10.68%
Revenue 1Y (TTM)2.75%
Revenue growth 3Y7.33%
Revenue growth 5Y1.1%
Sales Q2Q%1.7%
Revenue Next Year1.36%
Revenue Next 2Y3.3%
Revenue Next 3Y4.14%
Revenue Next 5Y4.69%
EBIT growth 1Y23.15%
EBIT growth 3Y13.42%
EBIT growth 5Y3.35%
EBIT Next Year46.59%
EBIT Next 3Y20.76%
EBIT Next 5Y16.11%
FCF growth 1Y11.14%
FCF growth 3Y8.64%
FCF growth 5Y2.35%
OCF growth 1Y16.67%
OCF growth 3Y10.92%
OCF growth 5Y3.06%