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Analysis of COLGATE-PALMOLIVE COMPANY (CL) shares


COLGATE-PALMOLIVE COMPANY (CL) is a consumer goods company. The company operates in two product segments: oral and personal care and pet food. The Oral & Personal Care segment operates across five geographic areas that include North America, Latin America, Europe, Asia Pacific and Africa / Eurasia. The company’s oral care products are comprised of several brands: Colgate Total, Colgate Sensitive Pro-Relief, Colgate Max Fresh, and Colgate Optic White. The company also specializes in various categories of personal care products, offering consumers liquid hand soaps, which it sells under the Palmolive, Protex and Softsoap brands. The company manufactures and markets a wide range of household cleaning and dishwashing products, including Palmolive and Ajax dishwashing liquids, Fabuloso and Ajax household cleaners, and Murphy’s soaps. Through its Hill’s Pet Nutrition (Hill’s) segment, COLGATE-PALMOLIVE produces food for pets, dogs and cats. The fair value of Entreprise Value (EV) is higher than its capitalization, which is a positive factor. The P / E ratio is the average for the US market for the companies included in the SP500 index. The dividend paid by the company is 2.37%. The capitalization / income multiplier is 3.87x. For every dollar invested, the investor will receive only 0.025 in the company’s assets. The margin generated by the company is at high levels and amounts to 23.7%. Sales are stable, outlook is up. Profit is stable, outlook is up. The company has significant financial strength. Leverage (Debt / EBITDA) is at 1.33x. Free cash flow is 3 billion. The ROA (Net Profit / Asset) ratio of 17.4% is high for Colgate. The high level of the group’s margin ensures high profits. Given the slight differences between the various analyst estimates, business visibility is good. The sales forecast was recently revised upwards. Over the past year, analysts have regularly revised their forecasts towards growth. The company does not have significant fundamental weaknesses. Considering the company’s prospects in relation to the sector, it should be admitted that the company is lagging behind at a distance of 5 years, but at a distance of two years it is knocked out in the middle of the rating by adding 20% ​​to its value, which provides investors with 12.5% ​​per annum dividends. Since 2019, the company’s shares have been in an upward trend and are currently recovering after a correction, which makes it possible to acquire assets at an attractive cost with a target of $ 94. At the same time, the ratio of profit and risk assumes a goal of 125, which, according to a rough estimate based on the current trend, the company can achieve by 2026, which, together with dividends, offers the investor up to 10% of annual income in US dollars. In this case, when the shares fall below the $ 58 level, the investor should think about fixing losses. Investments are possible for 5% of the amount of liquid capital. Shorter targets of interest to traders should imply shorter stops. The target at $ 94 implies a stop below the $ 72 level, but its realization may occur by the end of this year. An investor or trader should not deceive himself; he must strictly adhere to a previously adopted plan. Be careful and careful, follow the rules of money management. – Source: InstaForex

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