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Ecolab ROC (Joel Greenblatt) %

: 35.02% (As of Jun. 2022)
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Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits). He defines ROC (Joel Greenblatt) % as EBIT divided by the total of Property, Plant and Equipment and net working capital. Ecolab's annualized ROC (Joel Greenblatt) % for the quarter that ended in Jun. 2022 was 35.02%.

The historical rank and industry rank for Ecolab's ROC (Joel Greenblatt) % or its related term are showing as below:

ECL' s ROC (Joel Greenblatt) % Range Over the Past 10 Years
Min: 30.49   Med: 36.18   Max: 41.64
Current: 32.9

During the past 13 years, Ecolab's highest ROC (Joel Greenblatt) % was 41.64%. The lowest was 30.49%. And the median was 36.18%.

ECL's ROC (Joel Greenblatt) % is ranked better than
77.66% of 1455 companies
in the Chemicals industry
Industry Median: 16.56 vs ECL: 32.90

Ecolab's 5-Year average Growth Rate of ROC (Joel Greenblatt) % was -4.20% per year.


Ecolab ROC (Joel Greenblatt) % Historical Data

The historical data trend for Ecolab's ROC (Joel Greenblatt) % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Ecolab Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
ROC (Joel Greenblatt) %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 41.64 35.18 37.13 30.49 35.44

Ecolab Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
ROC (Joel Greenblatt) % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 39.20 41.51 33.54 22.41 35.02

Competitive Comparison

For the Specialty Chemicals subindustry, Ecolab's ROC (Joel Greenblatt) %, along with its competitors' market caps and ROC (Joel Greenblatt) % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Ecolab ROC (Joel Greenblatt) % Distribution

For the Chemicals industry and Basic Materials sector, Ecolab's ROC (Joel Greenblatt) % distribution charts can be found below:

* The bar in red indicates where Ecolab's ROC (Joel Greenblatt) % falls into.



Ecolab ROC (Joel Greenblatt) % Calculation

Joel Greenblatt defined Return on Capital differently in his book The Little Book That Still Beats the Market (Little Books. Big Profits) . He defines Return on Capital as follows:

ROC (Joel Greenblatt) %=EBIT/Average of (Net fixed Assets + Net Working Capital)

EBIT stands for Earnings Before Interest and Taxes.

Fixed Assets are also known as non-current assets. They include the Property, Plant and Equipment that the firm needs in its operation.

GuruFocus calculates net working capital as: (Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Deferred Revenue + Other Current Liabilities). We're trying to account for OPERATING assets and liabilities (part of daily business) when calculating working capital. Cash and marketable securities are considered NON-OPERATING assets and are not included in calculation. We will also back out all interest bearing debt, short term debt and the portion of long term debt that is due in the current period from the current liabilities. This debt will be considered when computing cost of capital and it would be inappropriate to count it twice.

Working Capital(Q: Mar. 2022 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(2508.2 + 1589.9 + 253.1) - (1870.9 + 96.8 + 1059.3)
=1324.2

Working Capital(Q: Jun. 2022 )
=(Accounts Receivable + Total Inventories + Other Current Assets) - (Accounts Payable & Accrued Expense + Defer. Rev. + Other Current Liabilities)
=(2668 + 1720.7 + 232.7) - (1962.9 + 99.1 + 1016.4)
=1543

When net working capital is negative, 0 is used.

So ROC (Joel Greenblatt) % of Ecolab for the quarter that ended in Jun. 2022 can be restated as:

ROC (Joel Greenblatt) %(Q: Jun. 2022 )
=EBIT/Average of (Net fixed Assets + Net Working Capital)
=EBIT/Average of (Property, Plant and Equipment+Net Working Capital)
     Q: Mar. 2022  Q: Jun. 2022
=EBIT/( ( (Property, Plant and Equipment + Net Working Capital) + (Property, Plant and Equipment + Net Working Capital) )/ count )
=1786.4/( ( (3671.5 + max(1324.2, 0)) + (3664.8 + max(1543, 0)) )/ 2 )
=1786.4/( ( 4995.7 + 5207.8 )/ 2 )
=1786.4/5101.75
=35.02 %

Note: The EBIT data used here is four times the quarterly (Jun. 2022) EBIT data.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Ecolab  (NYSE:ECL) ROC (Joel Greenblatt) % Explanation

The way Joel Greenblatt defines Return on Capital is a more accurate measure of how efficiently the company generates returns onthe capital actually invested in the business. EBIT is used instead of net income because the tax and interest payment may be affected by factors other than the core business operation. Intangible assets are not included in the calculation because they don't need to be replaced.

Joel Greenblatt uses his definition of Return on Capital and Earnings Yield (Joel Greenblatt) % to rank companies.


Ecolab ROC (Joel Greenblatt) % Related Terms

Thank you for viewing the detailed overview of Ecolab's ROC (Joel Greenblatt) % provided by GuruFocus.com. Please click on the following links to see related term pages.


Ecolab Business Description

Ecolab logo
Address
1 Ecolab Place, Saint Paul, MN, USA, 55102
Ecolab produces and markets cleaning and sanitation products for the hospitality, healthcare, and industrial markets. The firm is the global market share leader in this category with a wide array of products and services, including dish and laundry washing systems, pest control, and infection control products. The company has a strong hold on the U.S. market and is looking to increase its profitability abroad. Additionally, Ecolab serves customers in water, manufacturing, and life sciences end markets, selling customized solutions.
Executives
Sved Gergely officer: EVP & PRES - HC & LIFE SCI 1 ECOLAB PLACE ST. PAUL MN 55102
Bradway Jennifer J officer: SVP & CORPORATE CONTROLLER 1 ECOLAB PLACE ST. PAUL MN 55102
De Boo Alexander A. officer: EVP & PRES - GLOBAL MARKETS 1 ECOLAB PLACE SAINT PAUL MN 55102
Peterson Gail officer: SVP - Global Mktg & Comms 1 ECOLAB PLACE SAINT PAUL MN 55102
Charton Jerome officer: EVP - Global Regions 1 ECOLAB PLACE SAINT PAUL MN 55102
Duijser Machiel officer: EVP & CSCO 1 ECOLAB PLACE ST. PAUL MN 55102
Zillmer John J director ARAMARK CORP 1101 MARKET ST PHILADELPHIA PA 19107
Biller Leslie S director 10877 WILSHIRE BLVD 17TH FLOOR LOS ANGELES CA 90024
Mckibben Tracy B director 100 RIVERSIDE BOULEVARD #3S NEW YORK NY 10069
Reich Victoria director UNITED STATIONERS SUPPLY CO ONE PARKWAY NORTH BLVD SUITE 100 LAKE FOREST IL 60045
Ettinger Jeffrey M director 1 HORMEL PLACE AUSTINE MN 55912
Beck Barbara director 5301 N IRONWOOD RD MILWAUKEE WI 53217
Higgins Arthur J director C/O ZIMMER, INC. P.O. BOX 708 WARSAW IN 46580
Larson Michael director 2365 CARILLON POINT KIRKLAND WA 98033
Maclennan David director 14701 CHARLSON ROAD EDEN PRAIRIE MN 55347

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