* Note: Prices are in Million (M) USD.
Description:
Ecolab Inc., headquartered in St. Paul, Minnesota, is an American corporation that develops and offers services, technology and systems that specialize in water treatment, purification, cleaning and hygiene in a wide variety of applications. It helps organizations both private market as well as public treat their water, not only for drinking directly, but also for use in food, healthcare, hospitality related safety and industry.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $1,921 M
Debt : $8,967 M
EBITDA : $3,550 M
Net Debt (Debt - Cash): $7,047 M
Since Net Debt is covered by EBITDA within 2 years, 2 points assigned.
This criteria used industry in which company operates:
Sector: Basic materials
Industry: Specialty chemicals
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 34.94
Since Forward PE Ratio is between 25 - 35, 1 point assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $967 M
Average Revenue: $10,838 M
Revenue Converted To Free Cash Flow (%): 8.9%
Since Free Cash Flow (FCF) to Revenue percentage is less than 15, 1 point assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $15,741 M
Revenue 4 Years Ago (2020-12-31): $11,790 M
Last 5 Years Average Revenue Growth: 7%
Since Revenue Growth is between 5 - 10, 2 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $287 M
Share Count 5 Years Ago (2020-12-31): $287 M
Company is buying back its own shares, 3 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $8.52
Trailing 12-Month Earnings Per Share (EPS): $7.45
Average Earnings Per Share (EPS): $7.99
Dividend Per Share (DPS): $3
Payout Ratio: 32%
Dividend Yield: 1%
Since company Payout Ratio is less than 50, 2 points assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 20 valid ROE years (max 20).Average ROE: 16.4%
Since Average ROE is between 10 - 20, 3 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $279
52-Week Low: $221
Threshold Price (15% Above 52-Week Low): $254
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $79,650 M
Since Market Cap is between 10B - 100B, 2 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 3% exposure of Total Portfolio.
Value-Trade has assigned 19 points to above Ecolab Inc (ECL) stock.
Last 19 Years Avg PE 29.04, Fair Value PE 12, Industry Based PE 15, Growth Based PE 6, RCFC Based PE 19.14, ROE Based PE 23.09, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 17.34. Value-Trades has assined P/E value 17.34. Since an average (Current Year EPS + Next Year EPS) earning per share is $7.985.
The fair value of Ecolab Inc (ECL) stock should be (17.34 x $7.985) = $138.43.
