DBS analyst Cheria Widjaja has maintained their bullish stance on CL stock, giving a Buy rating on February 9.
Cheria Widjaja has assigned a Buy rating to Colgate-Palmolive’s stock based on a confluence of positive factors affecting the company’s performance and outlook. One significant aspect contributing to this recommendation is the company’s rebound in North American volume growth and market share during the fourth quarter of 2023, which is expected to continue into FY24F. This improvement, driven by product innovation and heightened advertising efforts, is particularly evident in the Oral Care segment. Colgate’s proactive strategy in boosting its product range with premium and entry-level options, combined with focused investments in digital and ESG initiatives, are seen as catalysts for sustained growth and market share gains in this key region.
In addition to the North American market, Colgate has demonstrated strong volume growth in Emerging Markets, showcasing the brand’s solid equity and ability to effectively adjust pricing strategies. This performance is anticipated to compensate for any potential slumps in the Hill’s Pet Nutrition segment, where the company is actively working to increase market penetration for long-term gains. Furthermore, the expected continuation of gross margin expansion into FY24F, due to pricing carryover and cost management initiatives, positions Colgate to absorb any cost pressures and foreign exchange variability. This margin improvement should also provide sufficient reinvestment capacity for brand and innovation support, underpinning the positive projections for Colgate’s earnings per share growth. Cheria Widjaja’s price target of $93 reflects this optimistic stance, factoring in Colgate’s defensive product mix, volume and market share momentum, and margin expansion, warranting a premium valuation.
In another report released on February 9, Argus Research also maintained a Buy rating on the stock with a $97.00 price target.
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Colgate-Palmolive (CL) Company Description:
Colgate-Palmolive Company is a multinational consumer products name engaged in production and distribution of household, personal care, oral care, health care, and veterinary products. The company sells its products across more than 200 countries and territories. The company’s well known global brands include Colgate, Palmolive, Speed Stick, Lady Speed Stick, Ajax, Softsoap and Hill’s pet Nutrition. It has two operating business segment – Oral, Personal and Home Care, and Pet Nutrition.
Read More on CL:
- Colgate-Palmolive price target raised to $97 from $88 at Argus
- Colgate-Palmolive price target raised to $96 from $85 at Bernstein
- Colgate-Palmolive price target raised to $93 from $85 at Morgan Stanley
- Colgate-Palmolive price target raised to $88 from $80 at Wells Fargo
- Colgate-Palmolive upgraded to Outperform from Market Perform at Raymond James
