Ecolab Inc. (NYSE:ECL) closed down 2.70% on Tuesday after its Q2 financial report. The company posted earnings per share of $1.10, below $1.22 in the prior year. The earnings were still more than estimates of $1.09 per share. The revenue for the quarter was higher at $3.58 billion from $3.16 billion in the prior year. Analysts had projected $3.48 billion in revenue.
Despite the stock closing lower on Tuesday, we believe the earnings were strong enough for a buy call. Ecolab stock has been recovering, with gains of 0.93% in a month. That compares to losses of 31% year-to-date. The low price of the stock had UBS analysts issuing an upgrade.
UBS Joshua Spector says Ecolab’s earnings revisions have troughed. That gives the company an upside potential to reach consensus projections next year. The analyst also opines that a ramp-up in the company’s pricing helps it neutralize the inflation issue. The analyst raised the stock’s price target from $186 to $205.
Ecolab stock retraces to the $156 support
Technically, Ecolab is retracing after breaking through the $156 support. The MACD indicators remain bullish on the stock.
Following the latest correction, Ecolab opens buy opportunities close to $156 support. The stock is pushing higher from the daily candlestick after the latest retracement. The next targets for the stock are $172 and $184. If the stock overcomes the two resistance levels, it will reclaim the $200 price, in line with UBS projections.
Summary
Buy Ecolab stock as the price remains bullish at the support zone. The stock has a buy rating with a $205 target at UBS. The immediate resistance is at $172.
The post Ecolab on a
