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How Does Ecolab Compare to Its Peers?

Gabriel Kane - Author
By

Jan. 11 2016, Updated 11:06 a.m. ET

Ecolab and its peers

In this article, we’ll compare Ecolab to its industry peers as of January 6, 2016. First, let’s compare Ecolab (ECL) and its peers based on PE (price-to-earnings) ratio:

Now let’s look at PBV (price-to-book value) ratios:

  • Ecolab: 4.7x
  • 3M: 7.4x
  • Danaher: 2.7x
  • ServiceMaster Global Holdings: 10.2x

According to the above findings, Ecolab’s peers have mostly outperformed Ecolab based on PBV. However, Ecolab has outperformed most of its peers based on PE.

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ETFs that invest in Ecolab  

The PowerShares Water Resource Portfolio (PHO) invests 7.5% of its holdings in Ecolab.

The Materials Select Sector SPDR ETF (XLB) invests 6.1% of its holdings in Ecolab. The ETF tracks a market-cap-weighted index of US basic materials companies. The fund includes only the materials components of the S&P 500.

The iShares Dow Jones US Basic Materials Sector ETF (IYM) invests 6.1% of its holdings in Ecolab. The ETF tracks a broad, market-cap-weighted index of US basic materials companies that include coal companies.

Comparing Ecolab and its peers

Now let’s look at ECL compared to its ETFs:

  • The year-to-date price movements of ECL, PHO, XLB, and IYM are -5.5%, -2.6%, -1.6%, and -1.7%, respectively.
  • The PE ratios of ECL, PHO, XLB, and IYM are 29.0x, 47.0x, 33.2x, and 31.7x, respectively.
  • The PBV ratios of ECL, PHO, XLB, and IYM are 4.7x, 2.7x, 3.5x, and 3.0x, respectively.

According to the above findings, these ETFs have outperformed Ecolab based on price movement and PE. However, Ecolab is ahead of its ETFs based on PBV.

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