ECOLAB INC (ECL)

US2788651006 - Common Stock

218.16  -1.05 (-0.48%)

After market: 218.16 0 (0%)

Fundamental Rating

5

Overall ECL gets a fundamental rating of 5 out of 10. We evaluated ECL against 84 industry peers in the Chemicals industry. ECL scores excellent on profitability, but 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.



7

1. Profitability

1.1 Basic Checks

In the past year ECL was profitable.
In the past year ECL had a positive cash flow from operations.
ECL had positive earnings in 4 of the past 5 years.
In the past 5 years ECL always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of ECL (6.28%) is better than 77.38% of its industry peers.
ECL has a better Return On Equity (17.06%) than 80.95% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.83%, ECL belongs to the top of the industry, outperforming 82.14% of the companies in the same industry.
ECL had an Average Return On Invested Capital over the past 3 years of 8.73%. This is in line with the industry average of 7.47%.
The 3 year average ROIC (8.73%) for ECL is below the current ROIC(9.83%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 6.28%
ROE 17.06%
ROIC 9.83%
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

Looking at the Profit Margin, with a value of 8.96%, ECL is in the better half of the industry, outperforming 77.38% of the companies in the same industry.
ECL's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 13.88%, ECL is doing good in the industry, outperforming 75.00% of the companies in the same industry.
ECL's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 40.39%, ECL belongs to the top of the industry, outperforming 82.14% of the companies in the same industry.
ECL's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 13.88%
PM (TTM) 8.96%
GM 40.39%
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%

5

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 more shares outstanding
Compared to 5 years ago, ECL has less shares outstanding
The debt/assets ratio for ECL has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 4.45 indicates that ECL is not in any danger for bankruptcy at the moment.
ECL's Altman-Z score of 4.45 is amongst the best of the industry. ECL outperforms 88.10% of its industry peers.
The Debt to FCF ratio of ECL is 5.00, which is a neutral value as it means it would take ECL, 5.00 years of fcf income to pay off all of its debts.
ECL has a better Debt to FCF ratio (5.00) than 70.24% of its industry peers.
A Debt/Equity ratio of 0.94 indicates that ECL is somewhat dependend on debt financing.
ECL has a Debt to Equity ratio of 0.94. This is in the lower half of the industry: ECL underperforms 66.67% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.94
Debt/FCF 5
Altman-Z 4.45
ROIC/WACC1.15
WACC8.55%

2.3 Liquidity

ECL has a Current Ratio of 1.30. This is a normal value and indicates that ECL is financially healthy and should not expect problems in meeting its short term obligations.
ECL has a worse Current ratio (1.30) than 82.14% of its industry peers.
A Quick Ratio of 0.95 indicates that ECL may have some problems paying its short term obligations.
ECL has a Quick ratio of 0.95. This is in the lower half of the industry: ECL underperforms 71.43% of its industry peers.
Industry RankSector Rank
Current Ratio 1.3
Quick Ratio 0.95

5

3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 16.04% over the past year.
ECL shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -0.15% yearly.
ECL shows a small growth in Revenue. In the last year, the Revenue has grown by 7.98%.
ECL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.87% yearly.
EPS 1Y (TTM)16.04%
EPS 3Y7.79%
EPS 5Y-0.15%
EPS growth Q2Q22.05%
Revenue 1Y (TTM)7.98%
Revenue growth 3Y9.12%
Revenue growth 5Y0.87%
Revenue growth Q2Q7.28%

3.2 Future

ECL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.59% yearly.
ECL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.51% yearly.
EPS Next Y23.75%
EPS Next 2Y19.1%
EPS Next 3Y17.05%
EPS Next 5Y14.59%
Revenue Next Year5.06%
Revenue Next 2Y5.15%
Revenue Next 3Y5.22%
Revenue Next 5Y5.51%

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.

2

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 41.87, the valuation of ECL can be described as expensive.
ECL's Price/Earnings ratio is a bit more expensive when compared to the industry. ECL is more expensive than 64.29% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.76. ECL is valued rather expensively when compared to this.
A Price/Forward Earnings ratio of 33.84 indicates a quite expensive valuation of ECL.
ECL's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. ECL is more expensive than 67.86% of the companies in the same industry.
ECL's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 21.26.
Industry RankSector Rank
PE 41.87
Fwd PE 33.84

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, ECL is valued a bit more expensive than 75.00% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as ECL.
Industry RankSector Rank
P/FCF 38.1
EV/EBITDA 22.83

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ECL may justify a higher PE ratio.
A more expensive valuation may be justified as ECL's earnings are expected to grow with 17.05% in the coming years.
PEG (NY)1.76
PEG (5Y)N/A
EPS Next 2Y19.1%
EPS Next 3Y17.05%

5

5. Dividend

5.1 Amount

ECL has a Yearly Dividend Yield of 1.04%.
Compared to an average industry Dividend Yield of 3.31, ECL has a dividend in line with its industry peers.
With a Dividend Yield of 1.04, ECL pays less dividend than the S&P500 average, which is at 2.44.
Industry RankSector Rank
Dividend Yield 1.04%

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.
As ECL did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)4.71%
Div Incr Years6
Div Non Decr Years6

5.3 Sustainability

44.98% of the earnings are spent on dividend by ECL. This is a bit on the high side, but may be sustainable.
The dividend of ECL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP44.98%
EPS Next 2Y19.1%
EPS Next 3Y17.05%

ECOLAB INC

NYSE:ECL (4/19/2024, 7:04:00 PM)

After market: 218.16 0 (0%)

218.16

-1.05 (-0.48%)

Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap62.37B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 1.04%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 41.87
Fwd PE 33.84
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.76
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 6.28%
ROE 17.06%
ROCE
ROIC
ROICexc
ROICexgc
OM 13.88%
PM (TTM) 8.96%
GM 40.39%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.7
Health
Industry RankSector Rank
Debt/Equity 0.94
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.3
Quick Ratio 0.95
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)16.04%
EPS 3Y7.79%
EPS 5Y
EPS growth Q2Q
EPS Next Y23.75%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)7.98%
Revenue growth 3Y9.12%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y