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Colgate-palmolive Company (CL)
:CL
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Colgate-Palmolive
(NYSE:CL)74Outperform
Positive Factors
Growth Strategy
Colgate's strategy changes in recent years are allowing the company to deliver consistent compounded top/bottom-line growth.
Innovation and Technology
Colgate is using AI for promotional optimization, which allows the company to run billions of scenarios for greater effectiveness.
Market Share
Colgate remains focused on increasing its household penetration and driving improved brand health to drive category growth and market share.
Negative Factors
North American Market
Macroeconomic and geopolitical risks, adverse foreign exchange movements, and a potential demand slowdown in North America could further impact growth.
Organic Sales Growth
Organic sales growth in the fourth quarter did not exceed long-term targets, causing a negative share price reaction.
Tariff Risks
Potential downside to guidance from tariff risk may have spooked investors.
Colgate-Palmolive (CL) vs. S&P 500 (SPY)
Market Cap
$73.90B
Dividend Yield2.15%
Average Volume (3M)4.84M
Price to Earnings (P/E)25.9
Beta (1Y)0.28
Revenue Growth3.30%
EPS Growth26.83%
CountryUS
Employees34,000
SectorConsumer Defensive
Sector Strength73
IndustryConsumer Products - Household & Personal
Share Statistics
EPS (TTM)3.51
Shares Outstanding811,536,440
10 Day Avg. Volume4,675,807
30 Day Avg. Volume4,840,631
Financial Highlights & Ratios
PEG Ratio0.97
Price to Book (P/B)N/A
Price to Sales (P/S)3.75
Price to Cash Flow (P/CF)14.80
P/FCF Ratio14.80
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$98.63Price Target Upside8.31% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
Colgate-Palmolive Business Overview & Revenue Model
Company DescriptionColgate-Palmolive Company (CL) is a global consumer products company focused on the production, distribution, and provision of household, health care, and personal care products. Established in 1806 and headquartered in New York City, the company operates in two main segments: Oral, Personal and Home Care, and Pet Nutrition. Its well-known brands include Colgate, Palmolive, Hill's Science Diet, and Speed Stick, making it a leading player in oral hygiene, pet nutrition, and other health and hygiene products worldwide.
How the Company Makes MoneyColgate-Palmolive generates revenue primarily through the sale of its products in the Oral, Personal and Home Care, and Pet Nutrition segments. The Oral, Personal and Home Care segment, which includes oral hygiene products like toothpaste and toothbrushes, as well as personal care products like body wash and deodorants, is the largest contributor to the company's revenue. The Pet Nutrition segment, represented by the Hill's Pet Nutrition brand, provides premium pet food for dogs and cats, catering to the veterinary and specialty pet retail channels. The company leverages its extensive global distribution network to reach a wide range of customers, from large retailers to individual consumers. Strategic partnerships, continuous innovation, brand strength, and a focus on emerging markets are significant factors contributing to Colgate-Palmolive's earnings.
Colgate-Palmolive Financial Statement Overview
Summary
Colgate-Palmolive demonstrates strong financial performance with stable revenue growth and robust cash flow. Despite a high debt-to-equity ratio, the company's profitability and cash generation mitigate some risks.Income Statement
Colgate-Palmolive shows strong financial performance with consistent revenue growth, achieving a 3.31% increase from 2023 to 2024. The company maintains healthy gross profit margins around 60.5% and a solid EBIT margin of 21.2%. However, the net profit margin slightly decreased to 14.4% due to increased costs. Overall, the income statement reflects a robust performance with sustainable growth trends.85
Very Positive
Balance Sheet
The balance sheet indicates a high debt-to-equity ratio of 34.4, highlighting significant leverage which poses potential financial risk. Despite this, the company has a positive return on equity at 136.4% due to strong net income relative to equity. The equity ratio remains low at 1.3%, suggesting reliance on debt financing. The balance sheet demonstrates stability but needs attention on debt management.70
Positive
Cash Flow
Colgate-Palmolive's cash flow position is strong, with a 16.7% growth in free cash flow from 2023 to 2024, showcasing effective cash management. The operating cash flow to net income ratio is 1.42, and the free cash flow to net income ratio is 1.23, indicating efficient conversion of profits into cash. The cash flow statement evidences robust cash generation and efficient capital expenditure management.90
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 20.10B | 19.46B | 17.97B | 17.42B | 16.47B | Gross Profit |
| 12.16B | 11.33B | 10.25B | 10.38B | 10.02B | EBIT |
| 4.27B | 3.98B | 4.33B | 4.47B | 3.88B | EBITDA |
| 4.27B | 4.25B | 4.13B | 4.37B | 4.33B | Net Income Common Stockholders |
| 2.89B | 2.30B | 1.78B | 2.17B | 2.69B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.10B | 1.15B | 775.00M | 832.00M | 888.00M | Total Assets |
| 16.05B | 16.39B | 15.73B | 15.04B | 15.92B | Total Debt |
| 7.29B | 9.06B | 8.90B | 7.25B | 7.60B | Net Debt |
| 6.19B | 8.10B | 8.12B | 6.41B | 6.71B | Total Liabilities |
| 15.50B | 15.44B | 14.93B | 14.07B | 14.82B | Stockholders Equity |
| 212.00M | 609.00M | 401.00M | 609.00M | 743.00M |
| Cash Flow | Free Cash Flow | |||
| 3.55B | 3.04B | 1.86B | 2.76B | 3.31B | Operating Cash Flow |
| 4.11B | 3.75B | 2.56B | 3.33B | 3.72B | Investing Cash Flow |
| -534.00M | -742.00M | -1.60B | -592.00M | -779.00M | Financing Cash Flow |
| -3.39B | -2.79B | -952.00M | -2.77B | -2.92B |
Colgate-Palmolive Technical Analysis
Neutral
91.06
Price Trends
88.85
Positive
91.89
Negative
95.13
Negative
Market Momentum
0.82
Negative
56.29
Neutral
77.78
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CL, the sentiment is Neutral. The current price of 91.06 is above the 20-day moving average (MA) of 88.42, above the 50-day MA of 88.85, and below the 200-day MA of 95.13, indicating a neutral trend. The MACD of 0.82 indicates Negative momentum. The RSI at 56.29 is Neutral, neither overbought nor oversold. The STOCH value of 77.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CL.
Colgate-Palmolive Risk Analysis
Colgate-Palmolive disclosed 19 risk factors in its most recent earnings report. Colgate-Palmolive reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Colgate-Palmolive Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $406.08B | 27.59 | 30.25% | 2.29% | 0.49% | 5.02% | |
74 Outperform | $73.90B | 25.95 | 1362.74% | 2.15% | 3.30% | 26.83% | |
74 Outperform | $27.35B | 46.91 | 13.42% | 1.03% | 4.08% | -22.34% | |
73 Outperform | $148.52B | 23.28 | 28.73% | 3.21% | 1.99% | -10.59% | |
71 Outperform | $47.10B | 18.80 | 302.98% | 3.40% | -1.83% | 45.13% | |
65 Neutral | $18.57B | 41.21 | -1114.63% | 3.12% | -1.98% | 474.83% | |
63 Neutral | $20.85B | 13.27 | -10.88% | 7.48% | 1.13% | 11.50% |
* Consumer Defensive Sector Average
Performance Comparison
CL
Colgate-Palmolive
91.06
6.18
7.28%
CHD
Church & Dwight
110.71
9.90
9.82%
CLX
Clorox
150.77
5.62
3.87%
KMB
Kimberly Clark
141.14
21.88
18.35%
PG
Procter & Gamble
173.18
17.70
11.38%
UL
Unilever
58.02
10.53
22.17%
Colgate-Palmolive Earnings Call Summary
Earnings Call Date: Jan 31, 2025 | % Change Since: 0.19% | Next Earnings Date: Apr 25, 2025
Earnings Call Sentiment Positive
The earnings call presented a generally positive outlook for Colgate-Palmolive, with strong achievements in revenue, growth, and market share despite facing challenges such as foreign exchange headwinds and competitive pressures in specific markets. The company's strategic investments in advertising and innovation are yielding positive results, while ongoing challenges in foreign exchange and specific regional markets are being addressed.Highlights
Record Net Sales Achievement
Colgate-Palmolive achieved net sales of $20 billion in 2024, one year ahead of the strategic plan ambition.
Consistent Organic Sales Growth
The company delivered high-single-digit organic growth for the sixth consecutive year, with volume growth in every division and category.
Increased Advertising Spending
Advertising spending increased by 15% in 2024, following a 19% increase in 2023, leading to improved brand health.
Global Toothpaste Market Share Growth
Colgate-Palmolive achieved its third consecutive year of global toothpaste category value share growth.
Innovation Success
Incremental sales contribution from innovation rose by 45% from 2021 to 2024.
Earnings and Cash Flow Growth
Double-digit base earnings per share growth ahead of initial guidance, record operating cash and free cash flow, and record cash return to shareholders.
Lowlights
Foreign Exchange Headwinds
Significant foreign exchange headwinds impacted gross and operating margins, with ongoing challenges expected in 2025.
Volume and Pricing Challenges in North America
North America faced volume softness, with ongoing challenges in the skin health business affecting performance.
Category Softness in Europe and China
Some parts of Europe and the skin health business in China experienced volume softness exiting 2024.
Competitive Environment in India and South Africa
Heightened competitive activity in India and South Africa was noted, particularly in urban markets and modern trade.
Company Guidance
In the call discussing Colgate-Palmolive's 2024 performance and 2025 outlook, the company highlighted several key metrics. Net sales reached $20 billion, one year ahead of their strategic plan, driven by high-single-digit organic sales growth for the sixth consecutive year, aligning with their long-term target of 3% to 5%. Advertising spending increased by 15%, and the incremental sales from innovation rose by 45% from 2021 to 2024. Despite significant foreign exchange headwinds, Colgate achieved gross and operating margin expansion, and double-digit growth in base earnings per share, along with record operating cash flow, free cash flow, and cash returns to shareholders. Looking ahead to 2025, the company plans to leverage strong brand health and innovation, with anticipated pricing growth supported by investments in data, analytics, and AI.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.