Colgate-Palmolive Poised for Fourth-Quarter Earnings Report
New York-based Colgate-Palmolive Company (CL) stands tall as a global leader in oral care hygiene, offering a wide range of household, healthcare, and personal care products. With a market capitalization of $73.7 billion, Colgate operates through its Oral, Personal & Home Care, and Pet Nutrition segments. The company plans to announce its fourth-quarter earnings before the market opens on Friday, January 31.
Analysts Anticipate Positive Earnings Growth
Ahead of the upcoming earnings report, analysts predict that Colgate will deliver a non-GAAP profit of $0.90 per share, representing a 3.5% increase from $0.87 reported in the same quarter last year. Colgate has shown a reliable earnings history, topping Wall Street expectations in each of the last four quarters. In the most recent quarter, its adjusted earnings per share (EPS) rose by 5.8% year-over-year to $0.91, surpassing forecasts by 3.4%.
Future Projections Show Steady Growth
Looking ahead to fiscal 2024, analysts project an adjusted EPS of $3.59 for Colgate, which would mark an 11.2% increase from $3.23 in fiscal 2023. Additionally, earnings for fiscal 2025 are expected to continue growing, with a projected year-over-year increase of 7.2% to reach $3.85.
Stock Performance Compared to Market Trends
Colgate’s stock has risen over 12.8% in the past 52 weeks. While this performance lags behind the S&P 500 Index’s ($SPX) impressive 26.3% jump, it has outperformed the Consumer Staples Select Sector SPDR Fund (XLP), which saw an 8.4% gain during the same period.
Investor Sentiment Following Q3 Report
Despite exceeding expectations for earnings and revenue growth, Colgate-Palmolive’s stock fell by 4.1% following the release of its Q3 results on October 25. The company reported a 2.4% year-over-year increase in net sales, totaling $5 billion, driven by a 6.8% rise in organic sales. These results exceeded Wall Street’s revenue predictions, and effective cost management contributed to improved gross and operating margins. Consequently, net income attributable to shareholders rose by 4.1% to $737 million.
Challenges in Key Markets
However, the overall performance was dimmed by net sales declines from two important regions. North America reported a 2.1% decline in net sales, while Latin America saw a 3.2% decrease compared to the previous year, which concerned investors.
Analysts’ Rating and Price Target
The consensus rating for CL stock remains moderately bullish, with a general “Moderate Buy” recommendation. Out of the 23 analysts monitoring the stock, 11 suggest a “Strong Buy,” two recommend a “Moderate Buy,” eight advise to “Hold,” and two advocate a “Strong Sell.” The mean price target stands at $104.61, indicating a 16% upside potential from current price levels.
On the date of publication, Aditya Sarawgi did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information in this article is for informational purposes only. For further details, please view the Barchart Disclosure Policy here.
The views expressed here are those of the author and do not necessarily reflect those of Nasdaq, Inc.
