Fair value: the average of the applicable valuation models (discounted cash flow, multiples, residual income, dividend discount, shareholder yield), each run on the latest financial statements and the market price shown. Opinion columns (fair value, target, rating) are shown apart from the data. Full methodology: acceinvestments.com/data/how-we-value-stocks
Conflicts of interest: The author holds no personal position in this security. General statement
Produced by ACCE Investments (acceinvestments.com)
Data
Price vs fair value
32.5% above
-24.5% to fair value
ACCE score
56
out of 100
Analysts
62% buy
21 covering
P/E
37.0x
forward 23.0x
1-year return
+19.9%
Dividend yield
2.18%
Colgate-Palmolive Company Common Stock in four questions
Plain answers, details below
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Overview
ACCE thesis
Colgate-Palmolive sells toothpaste (Colgate, Tom's of Maine), toothbrushes, and pet food (Hill's Science Diet and Prescription Diet), selling into more than 200 countries and territories. Its moat rests on brand strength and distribution scale in oral care, plus a veterinary-channel franchise in pet nutrition that is harder to displace than typical grocery shelf products. Revenue growth of 4.9% is the figure to watch, since the pet segment and emerging-market pricing have to carry volume that is otherwise flat in developed-market toothpaste. At a 35.4x trailing multiple against 21.0x forward, the market is paying for earnings recovery rather than current results, which makes execution on margins the key question. A 21.0% operating margin on a 60.4% gross margin is solid for a staples name, but the spread between trailing and forward valuation means the stock needs that margin to hold or improve for the multiple to compress toward its forward level. The score of 56/100 and absence from major indices suggest the name is not a consensus favorite, so it warrants a deeper look at margin trajectory and pet-segment growth before any conclusion.
⚠ Investor warnings · 4 flagsAI-assisted·How I use AI
high
Earnings decline amid valuation premium
Earnings fell 5.5% YoY while P/E sits at 34.8, well above historical norms for defensive consumer staples. Forward P/E of 21.6 suggests market expects recovery, but near-term momentum is negative.
high
Heavy insider selling
Last 10 disclosures show $31.21M in insider sales against $0 in buys. Insiders are exiting despite company messaging, a bearish signal on near-term prospects.
moderate
ACCE score deterioration
Score dropped 4 points to 57/100 over 90 days. Valuation (V:55) and Quality (Q:90) remain solid, but Growth (G:28) is weak, pulling the composite lower.
moderate
Leverage elevated for defensive stock
Debt/Equity of 13.88 is high for a consumer staples compounder. While FCF of $3.5B covers debt service, the ratio limits financial flexibility in a downturn.
AI research notes
AI-assisted·How I use AIWritten Oct 11, 2026 · figures from 2026-06-30 · prices to Oct 23, 2026
Why it could do well
Strong free cash flow generation of $3.5B supports a 4.9% yield and consistent shareholder returns.
Return on invested capital of 20.9% and ROE of 267.4% demonstrate efficient capital deployment.
Share buybacks reduced dilution by 1.4% last year while 62% of analysts rate the stock Buy or Strong Buy.
Why it could disappoint
Consensus fair value of $70.46 implies 20.2% downside from the current $88.27 share price.
Debt to equity of 13.88 creates refinancing risk if credit markets tighten or ratings decline.
Each chip shows the exact figure and where it comes from. A claim without a source is not published.
Next results
Oct 30, 2026
We update the fair value about 2 days after the results, once the new figures are filed.Add to calendarGoogle
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Valuation
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Where CL's valuation models land
Price
$94.04
Model fair value
$70.99
Model range
$53.22 to $82.20
Fair value $70.99
Price $94.04
The price is above the whole model range.
Model
Fair value
Upside
Discounted cash flow
Dividend discount
EV/EBITDA comparison
Graham number
P/E comparison
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Quality
INVESTOR
Quality and conviction INVESTOR FEATURE
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