ECOLAB INC (ECL)
US2788651006 - Common Stock
Overall ECL gets a fundamental rating of 5 out of 10. We evaluated ECL against 84 industry peers in the Chemicals industry. While ECL has a great profitability rating, there are some minor concerns on its financial health. ECL is quite expensive at the moment. It does show a decent growth rate.
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.
ECL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 6.28%, ECL is doing good in the industry, outperforming 77.38% of the companies in the same industry.
Looking at the Return On Equity, with a value of 17.06%, ECL belongs to the top of the industry, outperforming 80.95% of the companies in the same industry.
ECL has a Return On Invested Capital of 9.83%. This is amongst the best in the industry. ECL outperforms 82.14% of its industry peers.
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 last Return On Invested Capital (9.83%) for ECL is above the 3 year average (8.73%), which is a sign of increasing profitability.
| Industry Rank | Sector 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
ECL has a Profit Margin of 8.96%. This is in the better half of the industry: ECL outperforms 77.38% of its industry peers.
In the last couple of years the Profit Margin of ECL has declined.
The Operating Margin of ECL (13.88%) is better than 75.00% of its industry peers.
ECL's Operating Margin has been stable in the last couple of years.
With an excellent Gross Margin value of 40.39%, ECL belongs to the best of the industry, outperforming 82.14% 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 | 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%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ECL is creating some value.
The number of shares outstanding for ECL has been increased compared to 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
An Altman-Z score of 4.46 indicates that ECL is not in any danger for bankruptcy at the moment.
ECL's Altman-Z score of 4.46 is amongst the best of the industry. ECL outperforms 88.10% of its industry peers.
ECL has a debt to FCF ratio of 5.00. This is a neutral value as ECL would need 5.00 years to pay back of all of its debts.
The Debt to FCF ratio of ECL (5.00) is better than 70.24% of its industry peers.
ECL has a Debt/Equity ratio of 0.94. This is a neutral value indicating ECL is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.94, ECL is doing worse than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.94 | ||
| Debt/FCF | 5 | ||
| Altman-Z | 4.46 |
ROIC/WACC1.16
WACC8.51%
2.3 Liquidity
A Current Ratio of 1.30 indicates that ECL should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.30, ECL is doing worse than 82.14% of the companies in the same industry.
ECL has a Quick Ratio of 1.30. This is a bad value and indicates that ECL is not financially healthy enough and could expect problems in meeting its short term obligations.
ECL's Quick ratio of 0.95 is on the low side compared to the rest of the industry. ECL is outperformed by 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 16.04% over the past year.
Measured over the past years, ECL shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.15% on average per year.
The Revenue has been growing slightly by 7.98% in the past year.
Measured over the past years, ECL shows a small growth in Revenue. The Revenue has been growing by 0.87% on average per year.
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
Based on estimates for the next years, ECL will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.59% on average per year.
The Revenue is expected to grow by 5.51% on average over the next years.
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.
4. Valuation
4.1 Price/Earnings Ratio
ECL is valuated quite expensively with a Price/Earnings ratio of 41.95.
Compared to the rest of the industry, the Price/Earnings ratio of ECL indicates a slightly more expensive valuation: ECL is more expensive than 64.29% of the companies listed in the same industry.
ECL is valuated expensively when we compare the Price/Earnings ratio to 24.80, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 33.90, which means the current valuation is very expensive for ECL.
67.86% of the companies in the same industry are cheaper than ECL, based on the Price/Forward Earnings ratio.
ECL is valuated expensively when we compare the Price/Forward Earnings ratio to 21.27, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.95 | ||
| Fwd PE | 33.9 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ECL is valued a bit more expensive than the industry average as 75.00% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ECL is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.18 | ||
| EV/EBITDA | 22.93 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ECL has a very decent 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 17.05% in the coming years.
PEG (NY)1.77
PEG (5Y)N/A
EPS Next 2Y19.1%
EPS Next 3Y17.05%
5. Dividend
5.1 Amount
ECL has a Yearly Dividend Yield of 1.03%.
ECL's Dividend Yield is comparable with the industry average which is at 3.21.
Compared to an average S&P500 Dividend Yield of 2.40, ECL's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.03% |
5.2 History
The dividend of ECL has a limited annual growth rate of 4.71%.
ECL has been paying a dividend for at least 10 years, so it has 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, 9:58:45 AM)
218.585
-0.62 (-0.29%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap62.50B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.03% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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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 Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.95 | ||
| Fwd PE | 33.9 | ||
| 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)1.77
PEG (5Y)N/A
Profitability
| Industry Rank | Sector 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 Rank | Sector 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