CL Stock Risk & Deep Value Analysis
Colgate-Palmolive Co
Consumer Defensive • Household & Personal Products
DVR Score
out of 10
What You Need to Know About CL Stock
We analyzed Colgate-Palmolive Co using our deep value framework. Sign in to see our full verdict and DVR Score.
We ran CL through our deep value framework — analyzing financial health, distress signals, competitive moat, and risk factors. Our risk assessment: Moderate. Here's what we found.
CL Risk Analysis & Red Flags
What Could Go Wrong
Colgate's highly leveraged balance sheet, evidenced by a debt-to-equity ratio of 18.82 and liquidity concerns with a current ratio of 0.83, makes it vulnerable to rising interest rates or a significant economic downturn. A sustained period of high input costs could further erode its already pressured core profitability, severely impacting its ability to maintain dividends or invest in growth initiatives without taking on more debt.
Risk Matrix
Overall
Moderate
Financial
High
Market
Low
Competitive
Medium
Execution
Low
Regulatory
Low
Red Flags
- ⚠
Current ratio of 0.83, indicating potential short-term liquidity issues.
- ⚠
Quick ratio of 0.54, signaling even greater near-term liquidity stress.
- ⚠
Debt-to-equity ratio of 18.82, highlighting extreme reliance on debt financing.
- ⚠
2025 10-K noted core profitability erosion, despite recent net margin figures.
- ⚠
Analyst concerns over input cost inflation and EPS growth cut to 3-4% for 2026.
Upcoming Risk Events
- 📅
Persistent input cost inflation (oil, tallow)
- 📅
Increased competitive pressure from private labels or D2C brands
- 📅
Economic downturn impacting consumer discretionary spending on premium products
When to Reconsider
- 🚪
Exit if core operating margins show a sustained decline (e.g., three consecutive quarters of YoY contraction).
- 🚪
Sell if the debt-to-equity ratio increases significantly from current high levels without a clear deleveraging plan.
- 🚪
Exit if dividend growth stagnates or is cut, signaling fundamental business distress.
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What Does Colgate-Palmolive Co (CL) Do?
Market Cap
$67.91B
Sector
Consumer Defensive
Industry
Household & Personal Products
Employees
34,000
Colgate-Palmolive Company, together with its subsidiaries, manufactures and sells consumer products in the United States and internationally. It operates through two segments: Oral, Personal and Home Care; and Pet Nutrition. The Oral, Personal and Home Care segment offers toothpaste, toothbrushes, mouthwash, bar and liquid hand soaps, shower gels, shampoos, conditioners, deodorants and antiperspirants, skin health products, dishwashing detergents, fabric conditioners, household cleaners, and other related items. This segment markets and sells its products under the Colgate, Palmolive, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, EltaMD, Filorga, Irish Spring, Protex, Sanex, Softsoap, Lady Speed Stick, Speed Stick, PCA SKIN, Ajax, Axion, Fabuloso, Murphy, Suavitel, and Soupline brands to a range of traditional and eCommerce retailers, wholesalers, and distributors, as well as dentists and skin health professionals. It also offers pharmaceutical products for dentists and other oral health professionals. The Pet Nutrition segment offers pet nutrition products for everyday nutritional needs under the Hill's Science Diet brand; and a range of therapeutic pet products to help nutritionally support dogs and cats in different stages of health under the Hill's Prescription Diet brand. This segment markets and sells its products through pet supply retailers, veterinarians, and eCommerce retailers. Colgate-Palmolive Company was founded in 1806 and is headquartered in New York, New York.
Visit Colgate-Palmolive Co WebsiteInvestment Thesis
Colgate-Palmolive serves as a defensive, dividend-paying staple in a diversified portfolio, offering stability and modest, predictable growth. Its strong brand portfolio, global reach, and the consistent performance of its Hill's Pet Nutrition segment provide resilience against economic volatility, making it suitable for long-term, income-focused investors rather than those seeking exponential returns.
Is CL Stock Undervalued?
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CL Price Targets & Strategy
12-Month Target
$92.00
Bull Case
$100.00
Bear Case
$80.00
Valuation Basis
Based on 23.5x forward P/E applied to an estimated FY26 EPS of $3.90 (mid-point of analyst growth projections) = $91.65.
Entry Strategy
Consider dollar-cost averaging in the range of $83-$85. This area has historically shown support for CL amidst its typical trading range for a defensive stock.
Exit Strategy
Take profit on significant rallies towards analyst high targets ($98-$100). Implement a stop-loss order if the price consistently breaks below the $80 support level, indicating a shift in investor sentiment or deteriorating fundamentals.
Portfolio Allocation
2-4% for moderate risk tolerance, primarily as a defensive, income-generating component rather than a growth driver.
Price Targets & Strategy
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Is CL Financially Healthy?
Valuation
P/E Ratio
31.87
Forward P/E
22.00
EV/EBITDA
15.10
PEG Ratio
5.33
Price/Sales
3.85
Profitability
Gross Margin
60.11%
Operating Margin
16.06%
Net Margin
10.46%
Return on Equity
431.59%
Revenue Growth
1.40%
EPS
$2.62
Balance Sheet
Current Ratio
0.83
Quick Ratio
0.45
Debt/Equity
147.93
Total Debt
$8.50B
Cash & Equivalents
$2.10B
Cash Flow
Operating Cash Flow
$4.19B
Free Cash Flow
$3.63B
EBITDA
$5.50B
Other
Beta (Volatility)
0.31
Dividend Yield
2.50%
Does CL Have a Competitive Moat?
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🏰 Wide
Moat Trend
Stable
Moat Sources
3 Identified
Colgate-Palmolive's moat is highly durable, rooted in generations of consumer trust and habit for its essential personal and home care products. The company's brand power is exceptionally strong, making it difficult for new entrants to compete effectively on scale or perceived quality, especially in oral care and pet nutrition.
Moat Erosion Risks
- •Erosion of brand loyalty due to increasing private label competition and proliferation of niche D2C brands.
- •Rapid shifts in consumer preferences towards highly specialized or 'clean' products that CL may be slow to adapt to at scale.
CL Competitive Moat Analysis
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CL Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral. As a mature consumer staples company, CL typically does not generate significant social media buzz or meme stock-like interest.
Institutional Sentiment
Mixed to Positive. Recent analyst actions include upgrades from 'Neutral' to 'Buy' (Rothschild & Co Redburn, Deutsche Bank) alongside a 'Buy' to 'Hold' downgrade (TD Cowen). Target prices generally sit above the current market price, indicating cautious optimism.
Insider Activity (Form 4)
No specific Form 4 filings reporting buys/sells by named executives (CEO/CFO not flagged) within the last 90 days were provided in the research brief.
Options Flow
Normal options activity. No significant unusual put or call activity was reported in the provided real-time intelligence.
Earnings Intelligence
Next Earnings
Q1 2026 results released April 24, 2026. Earnings call scheduled for May 1, 2026.
Surprise Probability
Medium. While Q4 2025 beat estimates, analyst concerns over input costs and EPS growth cuts introduce uncertainty for Q1 2026, despite consensus estimates being in line with prior quarter actuals.
Historical Earnings Pattern
Colgate-Palmolive generally exhibits stable, modest stock price reactions to earnings reports, typically moving within a narrow band unless there's a significant surprise in guidance or core segment performance.
Key Metrics to Watch
Competitive Position
Top Competitor
Procter & Gamble (PG)
Market Share Trend
Stable. While facing competitive pressures, especially from private labels, CL has demonstrated resilient market share in its core categories, though no recent shifts were detailed.
Valuation vs Peers
CL typically trades at a P/E multiple largely in line with its consumer staples peers, reflecting its stable growth profile. Given the missing specific valuation metrics in the brief, it's difficult to provide an exact comparison but usually, such companies are priced similarly based on their earnings and dividend yield.
Competitive Advantages
- •Globally recognized brand portfolio (Colgate, Palmolive, Hill's)
- •Extensive global distribution network and supply chain efficiency
- •Significant scale providing cost advantages in procurement and manufacturing
Market Intelligence
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What Could Drive CL Stock Higher?
Near-Term (0-6 months)
- •Q1 2026 Earnings Call (May 1, 2026)
- •Dividend payment (ex-date Apr 20, 2026)
Medium-Term (6-18 months)
- •Continued growth and expansion of Hill's Pet Nutrition
- •Strategic premiumization efforts in oral and personal care segments
- •Expansion in emerging markets, driving incremental volume and pricing
Long-Term (18+ months)
- •Further consolidation in the consumer staples sector
- •Innovation in sustainable and health-focused product lines
- •Leveraging AI for supply chain optimization and personalized marketing
Catalysts & Growth Drivers
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What's the Bull Case for CL?
- ✓
Sustained acceleration in organic sales growth, particularly in premium segments.
- ✓
Evidence of successful cost management offsetting input cost inflation to protect margins.
Bull Case Analysis
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Competing with CL
See how Colgate-Palmolive Co compares to related companies
| Company | Market Cap | DVR Score | P/E | Revenue | Profit Margin | Rev Growth | |
|---|---|---|---|---|---|---|---|
Colgate-Palmolive Co CL | $67.9B | 0.9 | 31.9 | $20.4B | 10.5% | 1.4% | |
Costco Wholesale Corp COST | — | 0.7 | — | — | — | — | Compare → |
Coca-Cola Co KO | $324.9T | 0.4 | 3.1 | $47.9B | 27.3% | 1.9% | Compare → |
PepsiCo Inc PEP | — | 0.1 | — | — | — | — | Compare → |
Procter & Gamble Co PG | — | 0.2 | — | — | — | — | Compare → |
Walmart Inc WMT | $1.0T | 0.7 | 47.4 | $713.2B | 3.1% | 4.7% | Compare → |
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How Colgate-Palmolive Co Makes Money
Colgate-Palmolive is a global consumer products company that manufactures and markets a wide array of household, healthcare, personal care, and pet nutrition products. It makes money by selling these everyday essential goods, such as toothpastes, toothbrushes, soaps, detergents, and specialized pet food, to consumers worldwide through various retail channels, including supermarkets, hypermarkets, e-commerce, and specialized pet stores. The business model relies on strong brand recognition, extensive distribution networks, and continuous product innovation to maintain market leadership and consumer loyalty.
Read Full Business Model BreakdownFAQ
What is the DVR Score for Colgate-Palmolive Co (CL)?
As of April 27, 2026, Colgate-Palmolive Co has a DVR Score of 0.9 out of 10, placing it in the "Distressed" category. This score is generated by our AI-powered deep value analysis framework that evaluates growth potential, financial health, competitive moat, and risk factors.
What is the market capitalization of Colgate-Palmolive Co?
Colgate-Palmolive Co's market capitalization is approximately $67.9B. The company operates in the Consumer Defensive sector within the Household & Personal Products industry.
What ticker symbol does Colgate-Palmolive Co use?
CL is the ticker symbol for Colgate-Palmolive Co. The company trades on the NYQ.
What is the risk level for CL stock?
Our analysis rates Colgate-Palmolive Co's overall risk as Moderate. This assessment considers execution risk, market risk, financial risk, competitive risk, and regulatory risk. For a full breakdown, see the risk analysis section above.
What is the P/E ratio of CL?
Colgate-Palmolive Co currently has a price-to-earnings (P/E) ratio of 31.9. This is above the market average, suggesting the stock may be priced for high growth expectations.
Does Colgate-Palmolive Co pay a dividend?
Yes, Colgate-Palmolive Co pays a dividend with a current yield of approximately 2.50%.
Is Colgate-Palmolive Co's revenue growing?
Colgate-Palmolive Co has reported revenue growth of 1.4%. The company is growing at a moderate pace.
Is CL stock profitable?
Colgate-Palmolive Co has a profit margin of 10.5%. The company is profitable but margins are modest.
How often is the CL DVR analysis updated?
Our AI-powered analysis of Colgate-Palmolive Co is refreshed regularly to incorporate the latest financial data, market conditions, and news. The most recent update was on April 27, 2026.
Important Disclaimer – Not Financial Advice
Deep Value Reports is an independent research platform for educational and informational purposes only. We are not financial advisors, investment advisors, or licensed professionals. The analysis, scores, and information provided on this page for CL (Colgate-Palmolive Co) should not be construed as personalized investment advice, a recommendation to buy or sell any security, or an offer to provide investment advisory services.
All investments involve risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research, consider your financial situation, and consult with a qualified financial advisor before making any investment decisions.