This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Rent Colgate-Palmolive For Free Instead of Buying

Stocks in this article: CL

NEW YORK (TheStreet) - New York-based Colgate-Palmolive (CL) made a new 52-week high last week, and if you're not long you may want to take another look. I'm going to show you how to capture all the upside without exposing your portfolio to all the risk.

Colgate-Palmolive, together with its subsidiaries, manufactures and markets consumer products worldwide. You may know the company for its toothpaste products, but it markets a wide range of products including pet supplies. It's stock, currently trading around $65, is down nearly 1% for the year to date. CL Chart

Colgate-Palmolive hit my radar because of several factors. Strong revenue growth, dividends increase 300% during the last 10 years, bottom-ling earnings per share that support a rising stock price, and the company is about to distribute a fat dividend.

The company pays an oversized yield of 2.25% and the next ex-dividend date is April 17. Others may buy shares, but I'll show you another strategy to profit if the stock moves higher between now and the ex-dividend date. By using options and specifically in-the-money call options, investors can rent Colgate-Palmolive for almost free until April 16.

Call options give the buyer the right but not the obligation to buy a stock within a set period of time at a set price. Many factors influence the price of options including the underlying price, implied volatility, time until expiration, and interest rates, and dividend payments. I posted a Real Money Pro trade idea for Colgate-Palmolive for your review if you want exact entry and exit points. CL Revenue (Quarterly) Chart

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,883.30 +78.50 0.44%
S&P 500 2,072.27 +1.62 0.08%
NASDAQ 4,774.7930 +9.4130 0.20%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs