The Futility of Ecolab Inc. (NYSE:ECL)’s Fundamentals

Ecolab Inc. (NYSE:ECL) has a beta of 0.92, a 12-month trailing P/E ratio of 44.69, and a growth ratio of 5.51. The stock’s Relative Strength Index (RSI) is 52.66, with weekly volatility at 1.54% and ATR at 4.61. The ECL stock’s 52-week price range has touched low of $124.60 and a $231.36 high. Its shares traded lower over the last trading session, losing -0.83% on 10/13/20. The shares fell to a low of $200.85 before closing at $201.05. Intraday shares traded counted 0.99 million, which was 11.72% higher than its 30-day average trading volume of 1.12M. ECL’s previous close was $202.73 while the outstanding shares total 288.20M.

Investors have identified the Specialty Chemicals company Ecolab Inc. as an interesting stock but before investments are made there, an in-depth look at its trading activities will have to be conducted. The share is trading with a market value of around $56.90 billion, the company now has both obstacles and catalysts that affect them and they came from their mode of operations. With the company affected by events currently, it is a perfect time to analyze the numbers behind the firm in order to come up with a rather realistic picture of what this stock is.

Ecolab Inc. (ECL) Fundamentals that are to be considered.

When analyzing a stock, the first fundamental thing to take into account is the balance sheet. How healthy the balance sheet of a company is will determine if the company will be able to carry out all its financial and non-financial obligations and also keep the faith of its investors. For ECL, the company has in raw cash 1.37 billion on their books with 534.9 million currently as liabilities. How the trend is over time is what investors should be concerned about. The company has a healthy balance sheet as their debt profile has been on a decline. In terms of their assets, the company currently has 5166200000 million total, with 3227700000 million as their total liabilities.

ECL were able to record 508.0 million as free cash flow during the third quarter of the year, this saw their quarterly net cash flow reduce by 1.18 billion. In cash movements, the company had a total of 758.6 million as operating cash flow.

Potential earnings growth for Ecolab Inc. (ECL)

In order to determine the future investment potential for this stock, we will have to analyze key trends that affect it. During the third quarter of the year, Ecolab Inc. recorded a total of 2.69 billion in revenue. This figure implies that they witnessed a quarterly year/year change in their earnings with -18.0% coming in sequential stages and their sales for the third quarter reducing by -33.35%.

What matters though is how it ends. When the core data for the company is broken down, then the stock sounds interesting. The company spent 1.64 billion trying to sell their products during the last quarter, with the result yielding a gross income of 1.05 billion. This allows shareholders to hold on to 288.20M with the revenue now reading -6.98 cents per share. This is a figure that is close to analyst’s prediction for their fourth quarter (0.83 cents a share).

Having a look at the company’s valuation, the company is expected to record 5.82 total earnings per share during the next fiscal year. It is very important though to remember that the importance of trend far outweighs that of outlook. This analysis has been great and getting further updates on ECL sounds very interesting.

Is the stock of ECL attractive?

In related news, EVP – Innovation & Transformat, Wyant Jill S sold 5,729 shares of the company’s stock in a transaction that recorded on Sep 10. The sale was performed at an average price of 204.06, for a total value of 1,169,047. As the sale deal closes, the EVP – Innovation & Transformat, Wyant Jill S now sold 13,519 shares of the company’s stock, valued at 2,750,618. Also, Director, MacLennan David bought 400 shares of the company’s stock in a deal that was recorded on Aug 06. The shares were price at an average price of 194.05 per share, with a total market value of 77,621. Following this completion of acquisition, the Chairman and CEO, BAKER DOUGLAS M JR now holds 128,431 shares of the company’s stock, valued at 29,279,845. In the last 6 months, insiders have changed their ownership in shares of company stock by 0.40%.

4 out of 20 analysts covering the stock have rated it a Buy, while 14 have maintained a Hold recommendation on Ecolab Inc.. 2 analysts has assigned a Sell rating on the ECL stock. The 12-month mean consensus price target for the company’s shares has been set at $199.00.