3 Water Stocks With Decades Of Rising Dividends

Water Stock #2: Ecolab (ECL)

Ecolab is the global leader in water, hygiene, and energy technologies and services. The company operates in three major business segments: Global Industrial, Global Institutional, and Global Energy. The former includes customers in the food & beverage, manufacturing and chemical industries while the Global Institutional segment includes restaurants, hotels, hospitals and retailers. The Global Energy segment includes customers in the oil industry. Ecolab has raised its dividend for 35 consecutive years and thus it is a Dividend Aristocrat.

Ecolab has an exceptional growth record. It has grown its earnings per share every year in the last decade, except for the flat year 2016 and 2020, which was marked by the coronavirus crisis. Excluding the year of the pandemic, the company grew its earnings per share at a 10.9% average annual rate during 2010-2019.

Ecolab has achieved consistent growth thanks to the expansion of its customer portfolio as well as the acquisition of smaller companies. As Ecolab has a market share of only 9% in its business, it has ample room for future growth.

In the fourth quarter of 2020, Ecolab was affected by the pandemic. Just like in the previous quarters, the pandemic greatly benefited the healthcare segment of Ecolab but it hurt the industrial segment and the institutional segment. On the bright side, the effect of the pandemic was less severe than it was in the second and third quarter. Overall, Ecolab saw its adjusted revenue decrease 6% and its adjusted earnings per share fall 15% over the prior year’s quarter.

Ecolab expects the recovery to continue in the upcoming quarters. Overall, we expect the company to grow its earnings per share at a 13% average annual rate over the next five years off this year’s low comparison base. This growth should easily allow for continued dividend increases each year for Ecolab.

Water Stock #3: A.O. Smith (AOS)

A.O. Smith is a leading manufacturer of residential and commercial water heaters, boilers and water treatment products. It generates two-thirds of its sales in North America and nearly all the rest in China. The company has raised its dividend for 27 consecutive years and hence it is a Dividend Aristocrat.

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Disclaimer: All the information in this article - is published in good faith and for general information purpose only. Hashtag Investing does not make any warranties about the completeness, ...

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