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Investing.com - Raymond James initiated coverage on Ecolab Inc. (NYSE:ECL) with a Market Perform rating on Monday. The company, currently trading near its 52-week high at $278.36, has demonstrated strong fundamentals with a market capitalization of $79 billion and an impressive track record of maintaining dividend payments for 55 consecutive years.
The research firm expressed confidence that Ecolab could achieve 1% excess pricing over a shorter-term horizon in businesses where the company is clearly differentiated.
Raymond James noted these differentiated businesses are already priced at a significant premium to competitors.
The firm indicated it struggles to conceptually underwrite Ecolab’s pricing power over an extended holding period of 25-50 years, which it believes would be required for asymmetric upside in the stock at current levels.
Raymond James considers ECL shares "non-actionable" at present and stated it will wait for a more compelling initial risk/reward opportunity before taking a constructive stance on the stock.
In other recent news, Ecolab Inc . announced a definitive agreement to acquire Ovivo Electronics for approximately $1.8 billion in cash. This acquisition is aimed at bolstering Ecolab’s capabilities in water solutions for semiconductor manufacturing. Ovivo Electronics is projected to generate sales of $500 million in 2025, and the deal is expected to close in the first quarter of 2026, pending regulatory approvals. Jefferies has responded to this acquisition by raising its price target for Ecolab to $315 from $310, maintaining a Buy rating. Additionally, RBC Capital has reiterated its Outperform rating for Ecolab with a price target of $294 ahead of the company’s investor day. In other developments, Ecolab’s board declared a quarterly cash dividend of $0.65 per share, marking 88 consecutive years of dividend payments. This dividend will be payable on October 15, 2025, to shareholders recorded by September 16, 2025.
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