Zep, Inc. (ZEP): Why Ecolab Inc. (ECL) Could Do More With Its Dividend

But at least for now, there appears to be enough business to support growing efforts from Ecolab and the rest of the industry.

Ecolab Dividend data by YCharts.

As you can see, Ecolab’s dividend growth has been steady and substantial for decades. What the chart doesn’t show, though, is how much faster Ecolab’s share price has risen over that time. As a result, yields have fallen to relatively low levels, even though the company has boosted its dividend payout by double-digit percentage amounts annually since 2009. Given Ecolab’s intent to keep expanding around the world, further growth should help bolster dividend payouts in the future.

When will Ecolab boost its payout?
With Ecolab having raised its dividend last December, investors can expect another boost toward the end of this year. A jump to $0.26 or $0.27 per share would be consistent with past increases, though it would only push the yield up to 1.2% or so. Given Ecolab’s share-price performance, shareholders probably won’t mind the skimpy payout as long as they continue to enjoy big capital gains.

The article Why Ecolab Could Do More With Its Dividend originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Halliburton. The Motley Fool owns shares of Ecolab and Nuverra Environmental Solutions and has the following options: long January 2014 $4 calls and short January 2014 $3 puts on Nuverra.

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