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Colgate-Palmolive Co CL

Morningstar Rating
$99.39 +2.90 (3.01%)
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Company Report

Colgate Earnings: Sales Swell on the Heels of Prudent Investments, but Shares Not Attractive

The narrative around the weakening consumer spending backdrop is questionable, if wide-moat Colgate’s second-quarter results are any indication. Organic sales shot up 9% (on top of 8.2% growth last year), reflecting a near-balanced contribution from increased volumes (4.7%) and higher prices (4.2%). These runs counter to others in the industry, which have been more challenged to buoy volumes after several quarters of outsize price hikes.

Price vs Fair Value

CL is trading at a 533% premium.
Price
$99.39
Fair Value
$23.00
Uncertainty
Low
1-Star Price
$419.80
5-Star Price
$62.20
Economic Moat
Bkqxv
Capital Allocation
Rksyvffwnb

Bulls Say, Bears Say

Bulls

Increased pet adoption (up by mid-single-digits in the US) during the pandemic could buoy Colgate's Hill's business over a longer horizon than we anticipate.

Bears

Raw material, labor, and packaging costs have yet to deflate. Margins may be constrained over a longer horizon if Colgate's efforts to unlock efficiencies and/or raise prices to offset these pressures fail to prove durable.

Is it the right time to buy, sell, or hold?
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News

Trading Information

Previous Close Price
$96.49
Day Range
$98.32100.61
52-Week Range
$67.62100.61
Bid/Ask
$97.51 / $100.35
Market Cap
$81.54 Bil
Volume/Avg
7.1 Mil / 4.2 Mil

Key Statistics

Price/Earnings (Normalized)
28.72
Price/Sales
4.04
Dividend Yield (Trailing)
2.03%
Dividend Yield (Forward)
2.07%
Total Yield
3.89%

Company Profile

Since its founding in 1806, Colgate-Palmolive has grown to become a leading player in the household and personal care arena. In addition to its namesake oral care line, the firm manufactures shampoos, shower gels, deodorants, and homecare products that are sold in over 200 countries. International sales account for about 70% of its total business, including approximately 45% from emerging regions. It also owns specialty pet food maker Hill's, which primarily sells its products through veterinarians and specialty pet retailers.
Sector
Consumer Defensive
Industry
Household & Personal Products
Stock Style Box
Large Core
Total Number of Employees
34,000

Competitors

Valuation

Metric
CL
RKT
PG
Price/Earnings (Normalized)
28.729.9325.55
Price/Book Value
344.193.798.00
Price/Sales
4.042.184.91
Price/Cash Flow
23.2511.2520.35
Price/Earnings
CL
RKT
PG

Financial Strength

Metric
CL
RKT
PG
Quick Ratio
0.550.460.40
Current Ratio
1.060.690.69
Interest Coverage
17.477.7920.73
Quick Ratio
CL
RKT
PG

Profitability

Metric
CL
RKT
PG
Return on Assets (Normalized)
19.09%8.29%13.82%
Return on Equity (Normalized)
1,754.30%26.13%35.61%
Return on Invested Capital (Normalized)
35.18%14.13%20.62%
Return on Assets
CL
RKT
PG
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