Nomura Securities Raises Price Target on Ecolab (ECL) to $98; Reiterates Reduce
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Nomura Securities maintained a Reduce rating on Ecolab Inc. (NYSE: ECL), and raised the price target to $98.00 (from $94.00), following mid-year checks. Following -13% declines LTM, and a history of poor predictions, management
now pledges the cycle has bottomed and guides to an implied -6% decline in 2H.
Analyst Dan Dolev commented, "Following -13% LTM declines, mgmt. pledges the energy cycle has bottomed. Yet our proprietary energy model highlights sizable downside to its 2H implied guidance. Oddly, the stock has increased amid receding expectations. Yet we still see ~5% downside to FY17 cons. EPS as energy, legacy, and margin growth expectations remain overly optimistic, especially if the multi-year commodity cost tailwind reverses. With earnings quality in question (since ’12, ECL saw a ~20% dif. on avg. btw. reported and adj. EPS, ahead of 65% of the S&P) and a ~25x P/E, we reiterate REDUCE and see 20% pot. downside."
Shares of Ecolab Inc. closed at $122.77 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change
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