Ecolab (NYSE:ECL) Issues Quarterly Earnings Results

Ecolab (NYSE:ECL) released its quarterly earnings data on Tuesday. The basic materials company reported $2.18 earnings per share for the quarter, meeting analysts’ consensus estimates of $2.18, FiscalAI reports. Ecolab had a net margin of 12.57% and a return on equity of 22.72%. The firm had revenue of $4.69 billion for the quarter, compared to analyst estimates of $4.70 billion. During the same period last year, the firm earned $2.07 earnings per share. The business’s quarterly revenue was up 12.7% compared to the same quarter last year.

Here are the key takeaways from Ecolab’s conference call:

• Q3 marked an inflection point, with 7% organic sales growth, a 19.6% organic operating-income margin, and 11% organic operating-income growth despite elevated commodity costs. Management said pricing and supply-chain productivity are offsetting inflation.
• Global High-Tech accelerated sharply to 63% organic growth, while CoolIT more than doubled sales and Ovivo delivered strong double-digit growth. Ecolab reiterated its ambition for Global High-Tech to grow more than 25% annually, reach $4 billion in sales by 2030, and achieve a 25% operating-income margin.
• Growth engines continued to outperform, including Life Sciences at 17% organic growth, Ecolab Digital at 34%, and Pest Elimination at 8%. Management expects Life Sciences to approach $1 billion in sales and eventually reach a 30% operating-income margin.
• Management expects 2027 organic sales growth at the upper end of its 5%-7% target and adjusted operating-income margin to reach 20%, with adjusted EPS growth positioned to meet or exceed the long-term 12%-15% target as M&A-related amortization and interest headwinds ease.
• Institutional and Specialty remains pressured by declining restaurant traffic, particularly in North America, prompting Ecolab to expand sales capacity and reorganize service delivery. The company also plans to prioritize integrating Ovivo and CoolIT and deleveraging toward roughly two times leverage, limiting near-term appetite for additional acquisitions.

Ecolab Trading Up 2.0%

Shares of NYSE ECL traded up $5.71 during mid-day trading on Thursday, hitting $298.12. The stock had a trading volume of 311,782 shares, compared to its average volume of 1,444,570. The business has a 50 day moving average price of $281.26 and a two-hundred day moving average price of $275.83. Ecolab has a 1 year low of $243.15 and a 1 year high of $309.27. The company has a debt-to-equity ratio of 1.18, a quick ratio of 1.57 and a current ratio of 1.84. The firm has a market cap of $83.57 billion, a P/E ratio of 40.05, a price-to-earnings-growth ratio of 2.80 and a beta of 0.87.

Ecolab Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, October 15th. Stockholders of record on Tuesday, September 15th were issued a $0.73 dividend. The ex-dividend date was Tuesday, September 15th. This represents a $2.92 annualized dividend and a dividend yield of 1.0%. Ecolab’s dividend payout ratio (DPR) is currently 39.19%.

Analyst Ratings Changes

Several equities analysts recently weighed in on the stock. Wells Fargo & Company increased their price target on shares of Ecolab from $295.00 to $315.00 and gave the company an “equal weight” rating in a research report on Thursday. DA Davidson lifted their target price on Ecolab from $287.00 to $310.00 and gave the company a “buy” rating in a report on Friday, July 31st. BMO Capital Markets lifted their price objective on Ecolab from $345.00 to $360.00 and gave the company an “outperform” rating in a research note on Wednesday, July 29th. Berenberg Bank boosted their price target on shares of Ecolab from $299.00 to $305.00 and gave the stock a “buy” rating in a research note on Wednesday, August 19th. Finally, Zacks Research upgraded shares of Ecolab from a “strong sell” rating to a “hold” rating in a research report on Monday, September 7th. One equities research analyst has rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and three have assigned a Hold rating to the company. According to data from MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and a consensus target price of $328.58.

Insiders Place Their Bets

In other Ecolab news, CEO Christophe Beck sold 17,862 shares of the firm’s stock in a transaction on Tuesday, August 18th. The shares were sold at an average price of $280.14, for a total value of $5,003,860.68. Following the sale, the chief executive officer owned 72,932 shares of the company’s stock, valued at $20,431,170.48. This trade represents a 19.67% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. 0.50% of the stock is owned by insiders.

Ecolab Company Profile

Ecolab Inc is a global provider of water, hygiene, infection prevention and cleaning solutions for businesses and institutions. The company helps customers manage water and energy use, maintain sanitary operations, protect food supplies and comply with health and safety standards.

Ecolab serves customers across industries including food and beverage processing, hospitality, healthcare, life sciences, manufacturing, institutional facilities and energy. Its offerings include cleaning and sanitizing chemicals, water-treatment and process-management systems, pest-control services, kitchen and housekeeping products, infection-prevention programs, and related equipment, training and consulting services.

Founded in 1923 as Economics Laboratory, the company has expanded from its original focus on cleaning products into a broad range of technology-enabled services and solutions.