Why Is Ecolab Stock Falling Today?

Ecolab Inc. (NYSE:ECL) shares are trading lower on Tuesday.

The company reported second-quarter adjusted earnings per share of $1.89 missing the analyst consensus estimate of $1.90. Quarterly sales of $4.025 billion outpaced the Street view of $4.016 billion.

Reported sales increased 1%, including a 2% unfavorable impact from the sale of the global surgical solutions business. Organic sales increased 3%.

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“Our growth engines, which include Life Sciences, Pest Elimination, Global High-Tech and Ecolab Digital, collectively grew sales double digits, with very strong operating income growth,” said Ecolab CEO Christophe Beck.

Global Water fixed currency and organic sales both increased 2%, while Global Institutional & Specialty fixed currency sales declined 2% due to the sale of the global surgical solutions business last year.

Global Pest Elimination Fixed currency sales increased 7%, while Global Life Sciences Fixed currency and organic sales growth both remained solid at 4%.

Adjusted gross profit in the quarter under review expanded to $1.804 billion, higher than $1.745 billion a year ago. Adjusted gross margin expanded to 44.8% from 43.8% in the year-ago period.

Organic operating income increased 14%, as value pricing and improved productivity more than offset growth-oriented investments in the business.

The company exited the quarter with cash and equivalents worth $1.92 billion. The company’s short-term debt expanded to $688.5 million at quarter end, higher than $5.9 million in the year-ago period.

Ecolab Outlook

"In the second half of the year, we expect to continue to deliver 12-15% earnings growth,” Beck added.

“While the macroeconomic environment remains unpredictable, we are confident in our growth drivers and our ability to execute.”

Ecolab reaffirmed its fiscal year 2025 adjusted EPS guidance in the range of $7.42 to $7.62, compared with the $7.50 analyst estimate. The company also issued third-quarter adjusted EPS guidance of between $2.02 and $2.12, compared to the $2.06 consensus.

Price Action: ECL shares are trading lower by 4.29% to $258.28 at last check Tuesday.

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