ECOLAB INC (ECL) Stock Fundamental Analysis
NYSE:ECL - New York Stock Exchange, Inc. - US2788651006 - Common Stock - Currency: USD
ECL gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 84 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. ECL is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
ECL had positive earnings in the past year.
In the past year ECL had a positive cash flow from operations.
Of the past 5 years ECL 4 years were profitable.
ECL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ECL (9.25%) is better than 91.46% of its industry peers.
ECL has a Return On Equity of 23.92%. This is amongst the best in the industry. ECL outperforms 93.90% of its industry peers.
ECL's Return On Invested Capital of 11.88% is amongst the best of the industry. ECL outperforms 91.46% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ECL is above the industry average of 6.57%.
The 3 year average ROIC (8.73%) for ECL is below the current ROIC(11.88%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.25% | ||
| ROE | 23.92% | ||
| ROIC | 11.88% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)15.93%
ROE(5y)9.24%
ROIC(3y)8.73%
ROIC(5y)9.03%
1.3 Margins
ECL's Profit Margin of 13.04% is amongst the best of the industry. ECL outperforms 92.68% of its industry peers.
ECL's Profit Margin has declined in the last couple of years.
ECL has a better Operating Margin (16.29%) than 86.59% of its industry peers.
ECL's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 43.17%, ECL belongs to the top of the industry, outperforming 86.59% of the companies in the same industry.
In the last couple of years the Gross Margin of ECL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.29% | ||
| PM (TTM) | 13.04% | ||
| GM | 43.17% |
OM growth 3Y0.52%
OM growth 5Y-1.24%
PM growth 3YN/A
PM growth 5Y-1.67%
GM growth 3Y-1.08%
GM growth 5Y-0.45%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ECL is still creating some value.
ECL has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ECL has less shares outstanding
ECL has a better debt/assets ratio than last year.
2.2 Solvency
ECL has an Altman-Z score of 4.97. This indicates that ECL is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of ECL (4.97) is better than 93.90% of its industry peers.
ECL has a debt to FCF ratio of 3.80. This is a good value and a sign of high solvency as ECL would need 3.80 years to pay back of all of its debts.
ECL has a better Debt to FCF ratio (3.80) than 80.49% of its industry peers.
A Debt/Equity ratio of 0.82 indicates that ECL is somewhat dependend on debt financing.
ECL has a Debt to Equity ratio of 0.82. This is in the lower half of the industry: ECL underperforms 60.98% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.82 | ||
| Debt/FCF | 3.8 | ||
| Altman-Z | 4.97 |
ROIC/WACC1.39
WACC8.56%
2.3 Liquidity
A Current Ratio of 1.30 indicates that ECL should not have too much problems paying its short term obligations.
The Current ratio of ECL (1.30) is worse than 82.93% of its industry peers.
A Quick Ratio of 0.97 indicates that ECL may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.97, ECL is doing worse than 68.29% of the companies in the same industry.
ECL does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.97 |
3. Growth
3.1 Past
ECL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 29.82%, which is quite impressive.
The Earnings Per Share has been decreasing by -0.15% on average over the past years.
Looking at the last year, ECL shows a small growth in Revenue. The Revenue has grown by 4.13% in the last year.
The Revenue has been growing slightly by 0.87% on average over the past years.
EPS 1Y (TTM)29.82%
EPS 3Y7.79%
EPS 5Y-0.15%
EPS Q2Q%18.83%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y9.12%
Revenue growth 5Y0.87%
Sales Q2Q%1.02%
3.2 Future
Based on estimates for the next years, ECL will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.49% on average per year.
The Revenue is expected to grow by 4.70% on average over the next years.
EPS Next Y28.98%
EPS Next 2Y20.59%
EPS Next 3Y17.94%
EPS Next 5Y13.49%
Revenue Next Year2.74%
Revenue Next 2Y3.14%
Revenue Next 3Y3.91%
Revenue Next 5Y4.7%
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.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ECL is valuated quite expensively with a Price/Earnings ratio of 39.11.
Based on the Price/Earnings ratio, ECL is valued a bit more expensive than 67.07% of the companies in the same industry.
ECL is valuated rather expensively when we compare the Price/Earnings ratio to 28.28, which is the current average of the S&P500 Index.
ECL is valuated quite expensively with a Price/Forward Earnings ratio of 33.04.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ECL indicates a slightly more expensive valuation: ECL is more expensive than 70.73% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of ECL to the average of the S&P500 Index (91.29), we can say ECL is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.11 | ||
| Fwd PE | 33.04 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ECL is valued a bit more expensive than the industry average as 76.83% of the companies are valued more cheaply.
The rest of the industry has a similar Price/Free Cash Flow ratio as ECL.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.4 | ||
| EV/EBITDA | 21.89 |
4.3 Compensation for Growth
ECL's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ECL has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as ECL's earnings are expected to grow with 17.94% in the coming years.
PEG (NY)1.35
PEG (5Y)N/A
EPS Next 2Y20.59%
EPS Next 3Y17.94%
5. Dividend
5.1 Amount
ECL has a Yearly Dividend Yield of 1.07%. Purely for dividend investing, there may be better candidates out there.
ECL's Dividend Yield is comparable with the industry average which is at 3.21.
With a Dividend Yield of 1.07, ECL pays less dividend than the S&P500 average, which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
5.2 History
The dividend of ECL has a limited annual growth rate of 4.71%.
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)4.71%
Div Incr Years33
Div Non Decr Years33
5.3 Sustainability
ECL pays out 32.16% of its income as dividend. This is a sustainable payout ratio.
The dividend of ECL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP32.16%
EPS Next 2Y20.59%
EPS Next 3Y17.94%
ECOLAB INC
NYSE:ECL (1/30/2025, 12:15:16 PM)
250.307
+3.38 (+1.37%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners90.45%
Inst Owner Change-0.2%
Ins Owners0.11%
Ins Owner Change0.72%
Market Cap70.88B
Analysts75
Price Target284.59 (13.7%)
Short Float %0.84%
Short Ratio2.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
Yearly Dividend2.17
Dividend Growth(5Y)4.71%
DP32.16%
Div Incr Years33
Div Non Decr Years33
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.6%
Min EPS beat(2)-0.66%
Max EPS beat(2)-0.53%
EPS beat(4)0
Avg EPS beat(4)-0.53%
Min EPS beat(4)-0.66%
Max EPS beat(4)-0.28%
EPS beat(8)4
Avg EPS beat(8)0.09%
EPS beat(12)4
Avg EPS beat(12)-0.48%
EPS beat(16)7
Avg EPS beat(16)0.62%
Revenue beat(2)0
Avg Revenue beat(2)-1.99%
Min Revenue beat(2)-2.04%
Max Revenue beat(2)-1.93%
Revenue beat(4)0
Avg Revenue beat(4)-1.43%
Min Revenue beat(4)-2.04%
Max Revenue beat(4)-0.85%
Revenue beat(8)1
Avg Revenue beat(8)-1.12%
Revenue beat(12)4
Avg Revenue beat(12)-0.52%
Revenue beat(16)6
Avg Revenue beat(16)-0.56%
PT rev (1m)0.47%
PT rev (3m)4.57%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.46%
EPS NY rev (1m)0%
EPS NY rev (3m)0.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.39%
Revenue NY rev (1m)-0.06%
Revenue NY rev (3m)-0.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.11 | ||
| Fwd PE | 33.04 | ||
| P/S | 4.52 | ||
| P/FCF | 35.4 | ||
| P/OCF | 24.44 | ||
| P/B | 8.29 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.89 |
EPS(TTM)6.4
EY2.56%
EPS(NY)7.58
Fwd EY3.03%
FCF(TTM)7.07
FCFY2.83%
OCF(TTM)10.24
OCFY4.09%
SpS55.36
BVpS30.19
TBVpS-9.3
PEG (NY)1.35
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.25% | ||
| ROE | 23.92% | ||
| ROCE | 14.68% | ||
| ROIC | 11.88% | ||
| ROICexc | 12.81% | ||
| ROICexgc | 41.71% | ||
| OM | 16.29% | ||
| PM (TTM) | 13.04% | ||
| GM | 43.17% | ||
| FCFM | 12.77% |
ROA(3y)5.57%
ROA(5y)3.5%
ROE(3y)15.93%
ROE(5y)9.24%
ROIC(3y)8.73%
ROIC(5y)9.03%
ROICexc(3y)9.07%
ROICexc(5y)9.41%
ROICexgc(3y)30.19%
ROICexgc(5y)29.16%
ROCE(3y)10.86%
ROCE(5y)11.22%
ROICexcg growth 3Y9.87%
ROICexcg growth 5Y2.65%
ROICexc growth 3Y3.55%
ROICexc growth 5Y-0.34%
OM growth 3Y0.52%
OM growth 5Y-1.24%
PM growth 3YN/A
PM growth 5Y-1.67%
GM growth 3Y-1.08%
GM growth 5Y-0.45%
F-Score9
Asset Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.82 | ||
| Debt/FCF | 3.8 | ||
| Debt/EBITDA | 2 | ||
| Cap/Depr | 96.45% | ||
| Cap/Sales | 5.73% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.23% | ||
| Profit Quality | 97.93% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.97 | ||
| Altman-Z | 4.97 |
F-Score9
WACC8.56%
ROIC/WACC1.39
Cap/Depr(3y)78.7%
Cap/Depr(5y)75.7%
Cap/Sales(3y)5.04%
Cap/Sales(5y)4.93%
Profit Quality(3y)114.46%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)29.82%
EPS 3Y7.79%
EPS 5Y-0.15%
EPS Q2Q%18.83%
EPS Next Y28.98%
EPS Next 2Y20.59%
EPS Next 3Y17.94%
EPS Next 5Y13.49%
Revenue 1Y (TTM)4.13%
Revenue growth 3Y9.12%
Revenue growth 5Y0.87%
Sales Q2Q%1.02%
Revenue Next Year2.74%
Revenue Next 2Y3.14%
Revenue Next 3Y3.91%
Revenue Next 5Y4.7%
EBIT growth 1Y27.3%
EBIT growth 3Y9.69%
EBIT growth 5Y-0.38%
EBIT Next Year70.12%
EBIT Next 3Y25.4%
EBIT Next 5Y19.62%
FCF growth 1Y138.11%
FCF growth 3Y6.08%
FCF growth 5Y2.73%
OCF growth 1Y84.68%
OCF growth 3Y9.04%
OCF growth 5Y1.15%