Stifel has revised its target price for Ecolab (ECL, Financial), reducing it slightly to $303 from the previous $307, while maintaining a Buy rating on the stock. The analyst believes that Ecolab is well-positioned to navigate current tariff challenges, thanks to its robust local sourcing strategies and strong supply chain management. The company's ability to adjust pricing and benefit from favorable foreign exchange conditions is also noted as a significant factor. It is anticipated that Ecolab will reach its 2025 earnings per share goal, despite lower volumes, by leveraging these factors.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 20 analysts, the average target price for Ecolab Inc (ECL, Financial) is $277.50 with a high estimate of $310.00 and a low estimate of $232.96. The average target implies an upside of 12.39% from the current price of $246.91. More detailed estimate data can be found on the Ecolab Inc (ECL) Forecast page.
Based on the consensus recommendation from 27 brokerage firms, Ecolab Inc's (ECL, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Ecolab Inc (ECL, Financial) in one year is $208.87, suggesting a downside of 15.41% from the current price of $246.91. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Ecolab Inc (ECL) Summary page.
ECL Key Business Developments
Release Date: April 29, 2025
- Organic Sales Growth: 3% growth in organic sales.
- Earnings Per Share (EPS) Growth: 12% growth in EPS.
- Operating Income Margin Increase: 190 basis points increase in operating income margin.
- Life Sciences Segment Growth: Mid-single digits organic sales growth and over 30% organic operating income growth.
- Global High-Tech Sales Growth: Nearly 30% sales growth.
- Ecolab Digital Sales Growth: 12% growth to $80 million in the first quarter.
- Free Cash Flow: Strong and resilient free cash flow.
- Cash and Debt Position: Over $1 billion in cash and a 1.8 times net debt to adjusted EBITDA ratio.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ecolab Inc (ECL, Financial) reported a strong quarter with double-digit earnings growth, driven by a 3% increase in organic sales and a 12% rise in EPS.
- The company achieved a 190 basis points increase in operating income margin, moving towards its goal of a 20% operating income margin by 2027.
- Ecolab Inc (ECL) is well-positioned to navigate the complex global trade environment, with 92% of its sales produced locally, minimizing the impact of tariffs.
- The company's life sciences segment grew organic sales mid-single digits and delivered over 30% organic operating income growth.
- Ecolab Inc (ECL) is investing in long-term growth engines like life sciences, pest intelligence, global high-tech, and Ecolab digital, which are all performing well with attractive growth potential.
Negative Points
- The global operating environment is becoming more complex with softer end market demand and rapid changes in international trade policies.
- Ecolab Inc (ECL) expects the annualized impact from tariffs and increased local supplier costs to be a few hundred million dollars.
- The company announced a 5% rate surcharge for all customers in the United States to mitigate the impact of tariffs, which could affect customer relationships.
- Demand in heavy industrial markets has softened, and Ecolab Inc (ECL) expects it to remain soft for the remainder of the year.
- The pest elimination business is experiencing near-term growth and operating income challenges due to heavy investments in pest intelligence.
