Ecolab Inc. (NYSE: ECL) Surpasses Earnings Estimates

• Ecolab Inc. (NYSE: ECL) reported an EPS of $1.83, slightly above the estimated $1.82, marking a significant year-over-year improvement.
• The company raised its 2024 adjusted diluted EPS outlook to a range of $6.60 to $6.70, indicating a 27% to 29% increase.
• Despite falling short of revenue estimates, Ecolab experienced a 1% increase in reported sales and a 4% growth in organic sales.

Ecolab Inc. (NYSE: ECL) is a global leader in water, hygiene, and energy technologies and services. The company operates across various segments, providing solutions to industries such as food, healthcare, and hospitality. Ecolab competes with companies like Diversey Holdings and Clorox in the hygiene and cleaning products market.

On October 29, 2024, Ecolab reported earnings per share (EPS) of $1.83, slightly above the estimated $1.82. This performance marks a significant improvement from the previous year's EPS of $1.54. The company also reported a diluted EPS of $2.58 and an adjusted diluted EPS of $1.83, reflecting a 19% increase. Ecolab has raised its 2024 adjusted diluted EPS outlook to a range of $6.60 to $6.70, indicating a 27% to 29% increase.

Despite the positive earnings, Ecolab's revenue of approximately $3.998 billion fell short of the estimated $4.032 billion. However, the company experienced a 1% increase in reported sales compared to the previous year, reaching $4 billion. This growth occurred despite a 2% headwind from the sale of its global surgical solutions business and a 1% headwind from currency exchange. Organic sales grew by 4%, driven by successful new business acquisitions and innovations.

Ecolab's financial metrics reveal insights into its market valuation. The company's price-to-earnings (P/E) ratio is approximately 42.39, indicating that investors are willing to pay over 42 times the company's earnings over the past twelve months. The price-to-sales ratio stands at about 4.64, suggesting that investors are paying $4.64 for every dollar of sales generated by the company. The enterprise value to sales ratio is approximately 5.14.

The company's debt-to-equity ratio is about 0.93, showing a moderate level of debt financing compared to its equity. Ecolab's current ratio is approximately 1.50, indicating a reasonable level of liquidity to cover its short-term liabilities with its short-term assets. The enterprise value to operating cash flow ratio is around 27.68, providing insight into how the company's valuation compares to its cash flow from operations.