COLGATE-PALMOLIVE CO (CL) Stock Fundamental Analysis
NYSE:CL - New York Stock Exchange, Inc. - US1941621039 - Common Stock - Currency: USD
Taking everything into account, CL scores 6 out of 10 in our fundamental rating. CL was compared to 12 industry peers in the Household Products industry. CL scores excellent on profitability, but there are some minor concerns on its financial health. CL is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year CL was profitable.
In the past year CL had a positive cash flow from operations.
Each year in the past 5 years CL has been profitable.
Each year in the past 5 years CL had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 17.40%, CL belongs to the best of the industry, outperforming 91.67% of the companies in the same industry.
The Return On Equity of CL (798.07%) is better than 91.67% of its industry peers.
CL's Return On Invested Capital of 33.14% is amongst the best of the industry. CL outperforms 100.00% of its industry peers.
CL had an Average Return On Invested Capital over the past 3 years of 26.58%. This is significantly above the industry average of 15.79%.
The last Return On Invested Capital (33.14%) for CL is above the 3 year average (26.58%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.4% | ||
| ROE | 798.07% | ||
| ROIC | 33.14% |
ROA(3y)14.46%
ROA(5y)14.94%
ROE(3y)728.51%
ROE(5y)580.79%
ROIC(3y)26.58%
ROIC(5y)26.1%
1.3 Margins
CL has a Profit Margin of 14.52%. This is amongst the best in the industry. CL outperforms 91.67% of its industry peers.
CL's Profit Margin has been stable in the last couple of years.
CL's Operating Margin of 21.76% is amongst the best of the industry. CL outperforms 91.67% of its industry peers.
CL's Operating Margin has declined in the last couple of years.
CL has a Gross Margin of 60.71%. This is amongst the best in the industry. CL outperforms 100.00% of its industry peers.
In the last couple of years the Gross Margin of CL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.76% | ||
| PM (TTM) | 14.52% | ||
| GM | 60.71% |
OM growth 3Y-1.21%
OM growth 5Y-1.94%
PM growth 3Y4.95%
PM growth 5Y-0.96%
GM growth 3Y0.53%
GM growth 5Y0.34%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CL is creating value.
Compared to 1 year ago, CL has less shares outstanding
The number of shares outstanding for CL has been reduced compared to 5 years ago.
The debt/assets ratio for CL has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 6.95 indicates that CL is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 6.95, CL belongs to the top of the industry, outperforming 91.67% of the companies in the same industry.
CL has a debt to FCF ratio of 2.39. This is a good value and a sign of high solvency as CL would need 2.39 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.39, CL is doing good in the industry, outperforming 66.67% of the companies in the same industry.
CL has a Debt/Equity ratio of 18.10. This is a high value indicating a heavy dependency on external financing.
CL has a Debt to Equity ratio of 18.10. This is in the lower half of the industry: CL underperforms 75.00% of its industry peers.
Although CL does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 18.1 | ||
| Debt/FCF | 2.39 | ||
| Altman-Z | 6.95 |
ROIC/WACC3.91
WACC8.47%
2.3 Liquidity
A Current Ratio of 0.85 indicates that CL may have some problems paying its short term obligations.
CL's Current ratio of 0.85 is on the low side compared to the rest of the industry. CL is outperformed by 66.67% of its industry peers.
CL has a Quick Ratio of 0.85. This is a bad value and indicates that CL is not financially healthy enough and could expect problems in meeting its short term obligations.
CL has a Quick ratio of 0.54. This is in the lower half of the industry: CL underperforms 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.54 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.33% over the past year.
CL shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.87% yearly.
Looking at the last year, CL shows a small growth in Revenue. The Revenue has grown by 0.99% in the last year.
CL shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.08% yearly.
EPS 1Y (TTM)8.33%
EPS 3Y3.91%
EPS 5Y4.87%
EPS Q2Q%5.81%
Revenue 1Y (TTM)0.99%
Revenue growth 3Y4.89%
Revenue growth 5Y5.08%
Sales Q2Q%-3.04%
3.2 Future
CL is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.93% yearly.
CL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.83% yearly.
EPS Next Y4.97%
EPS Next 2Y6.05%
EPS Next 3Y6.57%
EPS Next 5Y7.93%
Revenue Next Year0.64%
Revenue Next 2Y2.3%
Revenue Next 3Y2.87%
Revenue Next 5Y2.83%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
CL is valuated quite expensively with a Price/Earnings ratio of 25.27.
Compared to the rest of the industry, the Price/Earnings ratio of CL indicates a slightly more expensive valuation: CL is more expensive than 75.00% of the companies listed in the same industry.
CL's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.60.
CL is valuated rather expensively with a Price/Forward Earnings ratio of 22.78.
CL's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.43, CL is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.27 | ||
| Fwd PE | 22.78 |
4.2 Price Multiples
CL's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. CL is more expensive than 66.67% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as CL.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.5 | ||
| EV/EBITDA | 16.45 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CL does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of CL may justify a higher PE ratio.
PEG (NY)5.08
PEG (5Y)5.19
EPS Next 2Y6.05%
EPS Next 3Y6.57%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.32%, CL has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.82, CL has a dividend in line with its industry peers.
CL's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
5.2 History
The dividend of CL has a limited annual growth rate of 3.11%.
CL has been paying a dividend for at least 10 years, so it has a reliable track record.
CL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.11%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
CL pays out 62.17% of its income as dividend. This is not a sustainable payout ratio.
The dividend of CL is growing, but earnings are growing more, so the dividend growth is sustainable.
DP62.17%
EPS Next 2Y6.05%
EPS Next 3Y6.57%
91.99
+0.25 (+0.27%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupHousehold & Personal Products
GICS IndustryHousehold Products
Earnings (Last)
Earnings (Next)
Inst Owners86.23%
Inst Owner Change0.37%
Ins Owners0.05%
Ins Owner Change2.19%
Market Cap74.55B
Analysts74.38
Price Target100.32 (9.06%)
Short Float %1.48%
Short Ratio2.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
Yearly Dividend2.19
Dividend Growth(5Y)3.11%
DP62.17%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.04%
Min EPS beat(2)-0.87%
Max EPS beat(2)2.94%
EPS beat(4)2
Avg EPS beat(4)0.92%
Min EPS beat(4)-0.87%
Max EPS beat(4)2.94%
EPS beat(8)5
Avg EPS beat(8)1.28%
EPS beat(12)6
Avg EPS beat(12)0.48%
EPS beat(16)6
Avg EPS beat(16)-0.25%
Revenue beat(2)0
Avg Revenue beat(2)-2.73%
Min Revenue beat(2)-3.46%
Max Revenue beat(2)-2%
Revenue beat(4)0
Avg Revenue beat(4)-2.43%
Min Revenue beat(4)-3.46%
Max Revenue beat(4)-1.98%
Revenue beat(8)0
Avg Revenue beat(8)-1.69%
Revenue beat(12)2
Avg Revenue beat(12)-1.47%
Revenue beat(16)2
Avg Revenue beat(16)-1.81%
PT rev (1m)0.95%
PT rev (3m)-2.54%
EPS NQ rev (1m)-4.2%
EPS NQ rev (3m)-4.56%
EPS NY rev (1m)-0.79%
EPS NY rev (3m)-1.4%
Revenue NQ rev (1m)0.92%
Revenue NQ rev (3m)0.86%
Revenue NY rev (1m)0.9%
Revenue NY rev (3m)0.59%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.27 | ||
| Fwd PE | 22.78 | ||
| P/S | 3.74 | ||
| P/FCF | 21.5 | ||
| P/OCF | 18.52 | ||
| P/B | 205.37 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.45 |
EPS(TTM)3.64
EY3.96%
EPS(NY)4.04
Fwd EY4.39%
FCF(TTM)4.28
FCFY4.65%
OCF(TTM)4.97
OCFY5.4%
SpS24.61
BVpS0.45
TBVpS-5.86
PEG (NY)5.08
PEG (5Y)5.19
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.4% | ||
| ROE | 798.07% | ||
| ROCE | 44.35% | ||
| ROIC | 33.14% | ||
| ROICexc | 38.27% | ||
| ROICexgc | 96.55% | ||
| OM | 21.76% | ||
| PM (TTM) | 14.52% | ||
| GM | 60.71% | ||
| FCFM | 17.38% |
ROA(3y)14.46%
ROA(5y)14.94%
ROE(3y)728.51%
ROE(5y)580.79%
ROIC(3y)26.58%
ROIC(5y)26.1%
ROICexc(3y)29.6%
ROICexc(5y)28.78%
ROICexgc(3y)61.47%
ROICexgc(5y)63.97%
ROCE(3y)35.89%
ROCE(5y)35.3%
ROICexcg growth 3Y6.99%
ROICexcg growth 5Y3.87%
ROICexc growth 3Y7.74%
ROICexc growth 5Y5.87%
OM growth 3Y-1.21%
OM growth 5Y-1.94%
PM growth 3Y4.95%
PM growth 5Y-0.96%
GM growth 3Y0.53%
GM growth 5Y0.34%
F-Score8
Asset Turnover1.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 18.1 | ||
| Debt/FCF | 2.39 | ||
| Debt/EBITDA | 1.33 | ||
| Cap/Depr | 92.7% | ||
| Cap/Sales | 2.8% | ||
| Interest Coverage | 15.07 | ||
| Cash Conversion | 81.45% | ||
| Profit Quality | 119.68% | ||
| Current Ratio | 0.85 | ||
| Quick Ratio | 0.54 | ||
| Altman-Z | 6.95 |
F-Score8
WACC8.47%
ROIC/WACC3.91
Cap/Depr(3y)114.92%
Cap/Depr(5y)104.56%
Cap/Sales(3y)3.43%
Cap/Sales(5y)3.21%
Profit Quality(3y)119.71%
Profit Quality(5y)121.85%
High Growth Momentum
Growth
EPS 1Y (TTM)8.33%
EPS 3Y3.91%
EPS 5Y4.87%
EPS Q2Q%5.81%
EPS Next Y4.97%
EPS Next 2Y6.05%
EPS Next 3Y6.57%
EPS Next 5Y7.93%
Revenue 1Y (TTM)0.99%
Revenue growth 3Y4.89%
Revenue growth 5Y5.08%
Sales Q2Q%-3.04%
Revenue Next Year0.64%
Revenue Next 2Y2.3%
Revenue Next 3Y2.87%
Revenue Next 5Y2.83%
EBIT growth 1Y3.85%
EBIT growth 3Y3.62%
EBIT growth 5Y3.04%
EBIT Next Year15.5%
EBIT Next 3Y9.04%
EBIT Next 5Y7.65%
FCF growth 1Y59.92%
FCF growth 3Y8.74%
FCF growth 5Y4.85%
OCF growth 1Y38.59%
OCF growth 3Y7.29%
OCF growth 5Y5.56%