U.S. cleaning and sanitation products major
Ecolab Inc
(
ECL
) has bumped up its quarterly dividend to 20 cents from 17.5 cents,
representing a 14.3% growth. This lifts the annual dividend to 80
cents per share from the current payout of 70 cents. The revised
quarterly dividend is payable on January 17, 2012, to shareholders
of record as on December 20, 2011.
This represents the Minnesota-based company's 20
th
consecutive annual dividend raise, underscoring its commitment to
deliver incremental returns to investors leveraging a solid balance
sheet and healthy cash flows. The company's previous dividend
increase was in late 2010, when it raised the quarterly payout by
13% to 17.5 cents.
Ecolab continues to post healthy revenue growth driven by new
business wins, product launches and sustained strong performances
across its Asia-Pacific and Latin American operations. The company
remains optimistic about delivering sustainable revenue and
earnings growth, backed by improvement in end-market demand,
ability to attract new customers and opportunities for greater
customer penetration through new product development.
Ecolab caters products and services to the hospitality,
foodservice, institutional and industrial markets. The company's
U.S. Cleaning & Sanitizing and International divisions face
stiff competition from
Clorox
(
CLX
) and
Church & Dwight
(
CHD
).
To drive growth, the company continues to invest in strategic
areas such as, product innovation, healthcare, water and energy and
global pest elimination while rationalizing operating costs.
Moreover, Ecolab remains focused on bringing new technologies aimed
at reducing food safety risks. Moreover, the company is active on
the acquisition front and is exploring opportunities to expand into
emerging markets for growth.
Ecolab recently completed its acquisition of Illinois-based
water treatment services major Nalco Holding Company. The merger
has created a behemoth in the water treatment space with more than
$11 billion in sales and operations in more than 160 nations.
Although we are impressed by Ecolab's strong international
exposure, we remain cautious about aggressive competition, raw
material price fluctuations and dilutive impact of the hefty
restructuring expenses on the company's bottom line. We currently
have a Neutral recommendation on Ecolab, which is supported by a
Zacks #3 Rank (Hold).
CHURCH & DWIGHT (
CHD
): Free Stock Analysis Report
CLOROX CO (
CLX
): Free Stock Analysis Report
ECOLAB INC (
ECL
): Free Stock Analysis Report
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