5 Best Water Stocks to Buy Now

2. Ecolab Inc. (NYSE:ECL)

Number of Hedge Fund Holders: 43

Ecolab Inc. (NYSE:ECL) is a Minnesota-based developer and provider of water cleaning, purification, and treatment services to three million customers spread across 40 industries.

The sanitation and hygiene conglomerate company came into the limelight after the billionaire philanthropist Bill Gates reported a stake of $25.4 million or 144,000 shares in the company on August 17. Ecolab Inc. (NYSE:ECL) is making significant efforts to keep water safe from bacteria and pathogens and is keeping its facilities up to the regulatory authorities requirements. Ecolab Inc. (NYSE:ECL) pays a quarterly dividend of $0.51 per share, translating into an annual dividend yield of 1.21% as of August 24.

Post the better-than-expected Q2 2022 results, David Begleiter at Deutsche Bank gave Ecolab Inc. (NYSE:ECL) stock a target price of $180 and maintained a Buy rating on the stock on July 27. Experts believe that during the inflationary period, Ecolab Inc. (NYSE:ECL) has been able to offset the impact of raw material headwinds through better pricing power.

Ecolab Inc. (NYSE:ECL) was discussed in the Q1 2022 investor letter of Baron Funds. Here’s what the investment management firm said:

“Lastly, we added to our position in the leading water, hygiene and infection prevention company, Ecolab Inc. (NYSE:ECL), as the stock sold off on concerns over rising raw material costs. We believe the sell-off is overdone as Ecolab’s strong competitive positioning and proven pricing power would enable it to offset the rising costs (though with a lag). We think that the company will continue benefiting from the secular growth trends towards sustainability, while still having a long runway for growth with only an 8% share of its estimated $147 billion addressable market.”