Shares in consumer products group Colgate-Palmolive (CL) shone brightly in pre-market trading despite the group reporting a drop in first quarter sales. It also said full year 2025 organic sales would be worse than first expected.
Lower American Demand
The company, whose other brands include Sanex and Ajax, reported a 3.1% drop in net sales to $4.91 billion beating expectations of $4.89 billion. It was hit by a drop-off in demand from North America where sales fell 3.6%, Latin America with an 8.7% decline and Asia Pacific down 5%. European sales however were up 2.5%.
The group reported earnings per share of $0.85, down on analyst estimates of $0.87 and a net income of $690 million, up from $683 million in the same time last year.
Other highlights included keeping Colgate’s leadership in toothpaste with a global market share at 40.9% and cleaning up in manual toothbrushes with a share of 31.9%.
Noel Wallace, chairman, president and chief executive officer said the performance had come in the “face of very difficult market conditions worldwide.” He added that “uncertainty and volatility in global markets, including the impact of tariffs, remain challenging.”
Tariffs Hit Forecasts
Indeed, Colgate-Palmolive said that given the impact of tariffs it had been forced to revise its 2025 guidance.
It said organic sales growth would likely be between 2% and 4%, down from previous guidance showing a 3% to 5% rise. Earnings per share would be up by low single digits compared with previous forecasts that they would grow by mid-single digits.
It also expects both gross profit margin and advertising investment to be roughly flat as a percentage of net sales.
The revision means CL has become the latest U.S. company following others such as Procter & Gamble, (PG) to note the likely detrimental impact of tariffs on its 2025 figures.
Is CL a Good Stock to Buy Now?
On TipRanks, CL has a Moderate Buy consensus based on 9 Buy, 5 Hold and 1 Sell rating. Its highest price target is $110. CL stock’s consensus price target is $99.86 implying an 7.72% upside. However, this could change given the new analyst notes expected in the wake of today’s results.
