Colgate-Palmolive shares were upgraded to buy from hold at Stifel, which sees home care and pet nutrition lifting organic sales.
The investment firm trimmed its earnings estimates on the New York consumer-products icon mainly due to foreign-exchange factors.
Stifel cut its fiscal 2020 and 2021 earnings-per-share estimates by 6% and 7%, respectively.
The firm also lowered its price target on CL shares 10% to $72 from $80, indicating 11% potential upside from the stock's Thursday closing price.
Colgate-Palmolive shares at last check were 2.5% higher at $65.39.
The firm now expects 2020 earnings per share of $2.79 vs. the Wall Street consensus estimate of $2.95. For 2021 Stifel sees Colgate-Palmolive earning $2.94 vs the consensus of $3.13.
"Colgate-Palmolive has a favorable position in the global oral-care market, holding over 40% share, with strong positioning in many other markets/segments in which it competes," Stifel's analysts wrote.
"We see upside risk to organic-sales growth near term, reflecting coronavirus-related buying, particularly in home care and pet nutrition, accounting for 18% and 16% of sales, respectively."
Stifel's tracking channels suggest that sales have accelerated significantly with sequentially improving sales growth over the past three one-week periods. That coincides with the spread of the coronavirus in the U.S.
"Overall we expect demand for Colgate’s products to remain strong even during an economic downturn," the firm said.
"Colgate was able to grow [comparable sales] above long-term targets during the 2008-2009 recession," Stifel's note said.
"[Due] to the nature of the current economic uncertainty, Colgate should be able to again outperform consumer-packaged-goods peers."