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Ecolab Inc. (ECL)

Company Dividend Discount ModelIndustry: Chemicals - SpecialtySector: Basic Materials

Valuation Snapshot

Stable Growth$88.05 - $150.10$114.98
Multi-Stage$99.52 - $108.87$104.11
Blended Fair Value$109.54
Current Price$273.86
Upside-60.00%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS3.74%6.79%2.332.162.111.981.961.941.741.571.501.40
YoY Growth--7.61%2.41%6.43%1.00%1.43%11.36%10.65%4.96%6.69%16.35%
Dividend Yield--0.92%0.95%1.28%1.12%0.92%1.24%0.97%1.15%1.19%1.26%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,984.60
(-) Cash Dividends Paid (M)725.80
(=) Cash Retained (M)1,258.80
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)396.92248.08148.85
Cash Retained (M)1,258.801,258.801,258.80
(-) Cash Required (M)-396.92-248.08-148.85
(=) Excess Retained (M)861.881,010.731,109.96
(/) Shares Outstanding (M)285.45285.45285.45
(=) Excess Retained per Share3.023.543.89
LTM Dividend per Share2.542.542.54
(+) Excess Retained per Share3.023.543.89
(=) Adjusted Dividend5.566.086.43
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate2.62%3.62%4.62%
Fair Value$88.05$114.98$150.10
Upside / Downside-67.85%-58.02%-45.19%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,984.602,056.362,130.712,207.752,287.582,370.292,441.40
Payout Ratio36.57%47.26%57.94%68.63%79.31%90.00%92.50%
Projected Dividends (M)725.80971.781,234.601,515.151,814.372,133.262,258.29

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.10%9.10%9.10%
Growth Rate2.62%3.62%4.62%
Year 1 PV (M)882.14890.74899.34
Year 2 PV (M)1,017.341,037.271,057.39
Year 3 PV (M)1,133.361,166.821,200.93
Year 4 PV (M)1,232.011,280.741,330.90
Year 5 PV (M)1,314.921,380.261,448.16
PV of Terminal Value (M)22,827.0523,961.2025,139.99
Equity Value (M)28,406.8429,717.0331,076.71
Shares Outstanding (M)285.45285.45285.45
Fair Value$99.52$104.11$108.87
Upside / Downside-63.66%-61.99%-60.25%

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