Investment Thesis
Ecolab demonstrates solid operational efficiency with a 17.0% operating margin and strong return on equity of 21.2%, supported by healthy free cash flow generation of $1.9B. The company maintains reasonable leverage at 0.75x debt/equity with strong interest coverage of 8.9x, though near-term growth is modest at 2.2% revenue expansion and slight net income contraction.
ECL Strengths
- Strong profitability with 12.9% net margin and 21.2% ROE indicating efficient capital deployment
- Robust free cash flow generation of $1.9B (11.8% FCF margin) provides financial flexibility
- Solid operational metrics with 8.9x interest coverage and 0.75x debt/equity showing manageable leverage
- Positive insider activity with 31 Form 4 filings in last 90 days suggests management confidence
ECL Risks
- Revenue growth deceleration at only 2.2% YoY with net income declining 0.8% YoY indicates demand softness
- Tight liquidity position with 1.08x current ratio and 0.81x quick ratio limits operational flexibility
- High long-term debt of $7.4B relative to annual operating cash flow requires sustained cash generation
- Flat to negative earnings momentum with diluted EPS down 1.2% YoY suggests profitability pressure
Key Metrics to Watch
- Quarterly revenue growth rate and operating margin sustainability
- Free cash flow trends and capital allocation decisions
- Debt reduction progress and refinancing activities
- Return on equity maintenance and working capital efficiency
ECL Financial Metrics
ECL Profitability Ratios
ECL Balance Sheet & Liquidity
ECL 5-Year Financial Trend
5-Year Trend Summary: ECOLAB INC.'s revenue has grown significantly by 26% over the 5-year period, indicating strong business expansion. The most recent EPS of $4.79 reflects profitable operations.
ECL Growth Metrics (YoY)
ECL Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $4.0B | $585.0M | $2.05 |
| Q2 2025 | $4.0B | $490.9M | $1.71 |
| Q1 2025 | $3.7B | $402.5M | $1.41 |
| Q3 2024 | $4.0B | $404.0M | $1.41 |
| Q2 2024 | $3.9B | $329.7M | $1.15 |
| Q1 2024 | $3.6B | $233.4M | $0.82 |
| Q3 2023 | $3.7B | $347.1M | $1.21 |
| Q2 2023 | $3.6B | $308.3M | $1.08 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
ECL Capital Allocation
ECL SEC Filings
Access official SEC EDGAR filings for ECOLAB INC. (CIK: 0000031462)