# Ecolab (ECL) Sector: Water & hygiene services | Field | Value | |---|---| | Price | $292.41 | | Market cap | $82B | | Intrinsic value source | Analysts | | Data as of | 2026-10-29 | | Next earnings | 2027-02-09 (estimate) | Analysts: Bullish Picks: Top pick Discount category: Below intrinsic value ## In short The market prices Ecolab for the cost and debt of its CoolIT deal, and faster organic growth, a higher margin and lower leverage in 2027 can close the gap. ## Themes and gap - Themes: AI supplier (ai-supplier), High debt (leverage) - Gap type: Can close (closable) - Why: The Q4 2026 report and 2027 outlook, expected in early February 2027, and the first full year of CoolIT in July 2027 show whether growth and margins pay for the new debt. ## About Ecolab sells water, hygiene and infection prevention products and services to customers in more than 170 countries. It has four reportable segments: Global Water, Global Institutional & Specialty, Global Pest Elimination and Global Life Sciences. Global Water includes Heavy Water, Light Water, High-Tech, Food & Beverage and Paper. High-Tech serves chip factories and data centers. Ecolab bought Ovivo Electronics, an ultrapure water business for chip factories, on December 16, 2025, and CoolIT Systems, a maker of liquid cooling systems for data centers, on July 2, 2026. Net sales were $13.18 billion in the first nine months of 2026. Ecolab has about 48,000 employees, and its headquarters is in St. Paul, Minnesota. ## Thesis The market prices Ecolab for the cost and the debt of its move into data center cooling. Ecolab paid about $4.75 billion in cash for CoolIT Systems, which the company said is 29 times CoolIT's estimated adjusted EBITDA for the next 12 months. It financed the deal with new debt, so total debt rose to $13.19 billion at September 30, 2026 from $8.24 billion at December 31, 2025. Amortization and financing costs of CoolIT lowered the 2026 adjusted EPS outlook to $8.10 to $8.20, from $8.43 to $8.63 in February 2026. Commodity costs and disruption in the Middle East also put pressure on margins in 2026. For the gap to close, three things must be true. Organic sales growth must reach the upper end of the 5% to 7% target in 2027, and the adjusted operating income margin must reach 20%, as the company expects. Ovivo Electronics and CoolIT must add about two percentage points to annual organic sales growth one year after each closing, as the company expects. Ecolab must bring net debt back to about 2 times adjusted EBITDA by the end of the second year after the CoolIT closing, which is mid-2028. The Q4 2026 report and the 2027 outlook, expected in early February 2027, are the next test. The first full year of CoolIT, in July 2027, is a second test. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is slower data center or chip factory spending, which can lower the growth that justified the CoolIT price. ## Checkpoints - Feb 9, 2027 (estimate): Q4 2026 results and 2027 outlook. Status: Pending. Watch: Q4 adjusted diluted EPS within $2.13 to $2.23 and a 2027 outlook with organic sales growth near the top of 5% to 7% and adjusted EPS growth of 12% to 15% pass; a lower outlook or slower High-Tech growth fail. - Jul 2027 (estimate): One year of CoolIT. Status: Pending. Watch: CoolIT and Ovivo Electronics that add about two percentage points to organic sales growth, as the company expects, pass; slower data center sales or a goodwill impairment fail. ## Balance sheet - Cash: $722M - Debt: $13.2B - Net debt: $12.5B - Interest cover: 8.0× - Undrawn credit line: $2.0B, to March 2030 - Debt due within 12 months: $1.3B Ecolab funds itself with senior notes, commercial paper and bank lines. Total debt was $13.19 billion at September 30, 2026: short-term debt of $1.28 billion and long-term debt of $11.92 billion. It was $8.24 billion at December 31, 2025. The increase came mostly from the $5.0 billion of senior notes that Ecolab sold in May 2026 to buy CoolIT Systems. Cash was $722.3 million at September 30, 2026. Interest cover is operating income divided by net interest expense for the first nine months of 2026. The undrawn credit is the $2.0 billion revolving credit facility, which had no borrowings at June 30, 2026 and expires in March 2030. When it announced CoolIT, Ecolab expected net debt of about 3 times adjusted EBITDA at the closing and about 2 times by the end of the second year after the closing. Cash from operations was $1.18 billion and capital spending was $588.6 million in the first half of 2026. Ecolab bought back shares for $669 million in the first half of 2026. As of 2026-09-30. Sources: - https://www.sec.gov/Archives/edgar/data/31462/000162828026067418/ecl_ex99x1.htm - https://www.sec.gov/Archives/edgar/data/31462/000162828026053886/ecl-20260630.htm - https://www.sec.gov/Archives/edgar/data/31462/000110465926068276/tm2615907d1_8k.htm - https://www.sec.gov/Archives/edgar/data/31462/000110465926032446/tm269446d1_ex99-1.htm ## Dividends - Dividend yield: 1.0% (last 12 months, at the current price) - Paid per share, last 12 months: $2.92 (4 payments) - Current annual rate: $2.92 ($0.73 x 4 a year) - Payout ratio: 37% of the earnings of the last fiscal year (the year ended 2025-12-31) - Latest ex-dividend date: 2026-09-15, $0.73 per share - Growth over the last 5 years: 8.7% a year - Growth over the last 10 years: 7.6% a year Dividends per share by year: 2016: $1.42, 2017: $1.52, 2018: $1.69, 2019: $1.85, 2020: $1.89, 2021: $1.95, 2022: $2.06, 2023: $2.16, 2024: $2.36, 2025: $2.68. Source: company filings and market data, read on 2026-10-29. ## Recent events - 2026-10-27: Ecolab reported Q3 2026 results. Reported sales rose 13% to $4.69 billion, and organic sales rose 7%, with volume up 2% and pricing up 5%. Organic sales of Global High-Tech rose 63%. Reported diluted EPS fell 5% to $1.95, and adjusted diluted EPS rose 5% to $2.18, after a headwind of about 10% from CoolIT amortization and financing costs. Ecolab narrowed its 2026 adjusted diluted EPS outlook to $8.10 to $8.20. - 2026-07-28: Ecolab reported Q2 2026 results. Reported sales rose 10% to $4.4 billion, organic sales rose 5%, and adjusted diluted EPS rose 11% to $2.09. Ecolab raised its 2026 adjusted diluted EPS outlook to $8.05 to $8.25, from $8.03 to $8.23. This outlook includes the cost of the CoolIT acquisition. - 2026-07-02: Ecolab completed the acquisition of CoolIT Systems. CoolIT designs and makes liquid cooling systems for data centers, such as coolant distribution units and cold plates. The business is now part of the Global Water segment. - 2026-05-29: Ecolab sold $5.0 billion of senior notes: $1.2 billion of 4.600% notes due 2029, $900 million of 4.800% notes due 2031, $1.5 billion of 5.150% notes due 2033 and $1.4 billion of 5.350% notes due 2036. It used the money for the CoolIT acquisition and for general purposes. - 2026-04-28: Ecolab reported Q1 2026 results. Reported diluted EPS was $1.52, and adjusted diluted EPS rose 13% to $1.70. Ecolab kept its 2026 adjusted diluted EPS outlook of $8.43 to $8.63, before the CoolIT acquisition. - 2026-03-20: Ecolab agreed to buy CoolIT Systems from funds managed by KKR for about $4.75 billion in cash. Ecolab expected CoolIT to have sales of about $550 million in the next 12 months. It expected net debt of about 3 times adjusted EBITDA at the closing and about 2 times by the end of the second year after the closing. - 2026-02-10: Ecolab reported Q4 2025 results. Adjusted diluted EPS rose 15% to $2.08, and adjusted diluted EPS for 2025 was $7.53. Ecolab gave a 2026 adjusted diluted EPS outlook of $8.43 to $8.63. It also expanded its One Ecolab restructuring program, with total restructuring costs of $334 million by the end of 2027. ## Latest news and filings - Last earnings: 2026-10-27 (8-K: https://www.sec.gov/Archives/edgar/data/31462/000162828026067418/) - Next earnings: 2027-02-09 (expected; the company has not confirmed it) | Filed | Form | Headline | Period end | XBRL document | Link | | --- | --- | --- | --- | --- | --- | | 2026-10-27 | 8-K | Earnings release | | ecl-20261027 | https://www.sec.gov/Archives/edgar/data/31462/000162828026067418/ecl-20261027.htm | | 2026-08-06 | 10-Q | Quarterly report for the period ended Jun 30, 2026 | 2026-06-30 | ecl-20260630 | https://www.sec.gov/Archives/edgar/data/31462/000162828026053886/ecl-20260630.htm | | 2026-07-28 | 8-K | Earnings release | | ecl-20260728 | https://www.sec.gov/Archives/edgar/data/31462/000162828026049933/ecl-20260728.htm | | 2026-05-29 | 8-K | Other company news | | | https://www.sec.gov/Archives/edgar/data/31462/000110465926068276/tm2615907d1_8k.htm | | 2026-05-11 | 8-K | Change of directors or officers and Shareholder vote results | | ecl-20260507x8k | https://www.sec.gov/Archives/edgar/data/31462/000110465926058710/ecl-20260507x8k.htm | | 2026-05-07 | 10-Q | Quarterly report for the period ended Mar 31, 2026 | 2026-03-31 | ecl-20260331x10q | https://www.sec.gov/Archives/edgar/data/31462/000110465926056737/ecl-20260331x10q.htm | | 2026-04-28 | 8-K | Earnings release | | ecl-20260428x8k | https://www.sec.gov/Archives/edgar/data/31462/000110465926049822/ecl-20260428x8k.htm | | 2026-04-15 | 8-K | New material agreement and New debt or financial obligation | | ecl-20260410x8k | https://www.sec.gov/Archives/edgar/data/31462/000110465926043821/ecl-20260410x8k.htm | | 2026-03-27 | 8-K | Earnings release | | ecl-20260327x8k | https://www.sec.gov/Archives/edgar/data/31462/000110465926035705/ecl-20260327x8k.htm | | 2026-02-25 | 8-K | Change of directors or officers | | ecl-20260220x8k | https://www.sec.gov/Archives/edgar/data/31462/000110465926019742/ecl-20260220x8k.htm | Every filing on SEC EDGAR (CIK 31462): https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000031462&type=&dateb=&owner=include&count=40 ## Risks - High: Ecolab paid about 29 times CoolIT's estimated adjusted EBITDA for the next 12 months. CoolIT sells only to data centers. If spending on AI data centers slows, or if competitors win cooling orders, CoolIT's growth can fall short and Ecolab can record an impairment of goodwill. Goodwill was $12.69 billion at September 30, 2026. - Medium: Total debt was $13.19 billion at September 30, 2026, and net interest expense was $124.8 million in Q3 2026, up from $55.3 million a year earlier. More debt leaves less cash for buybacks and other acquisitions until the company lowers leverage. - Medium: Commodity costs rose in 2026, and the conflict in the Middle East disrupted customer operations. Ecolab used price increases and an energy surcharge to keep its organic gross margin stable. If costs rise faster than prices, margins can fall. - Low: The Institutional business depends on restaurants and hotels. In Q3 2026, the company said that restaurant foot traffic in North America fell by a mid-single-digit percentage. A weaker consumer can lower demand in this business. ## Links - Page: https://picks.utilarium.app/company/ECL/ - History of changes: https://picks.utilarium.app/company/ECL/history/ - JSON with full history: https://picks.utilarium.app/data/company/ECL.json > Picks is a personal record of stock picks. It gives general information only, not financial, investment, tax or legal advice, and not advice for your situation. It is not a recommendation to buy or sell. Kevin may hold any stock on this site. Prices, intrinsic values and ratings can be delayed or wrong; check the original source. Full disclaimer: /disclaimer/.