NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, solid stock price performance, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company has had generally poor debt management on most measures that we evaluated.
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Highlights from the ratings report include:
- CL's revenue growth has slightly outpaced the industry average of 0.2%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- COLGATE-PALMOLIVE CO has improved earnings per share by 6.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, COLGATE-PALMOLIVE CO increased its bottom line by earning $4.94 versus $4.31 in the prior year. This year, the market expects an improvement in earnings ($5.39 versus $4.94).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Household Products industry average. The net income increased by 3.0% when compared to the same quarter one year prior, going from $576.00 million to $593.00 million.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Household Products industry and the overall market, COLGATE-PALMOLIVE CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
Colgate-Palmolive Company, together with its subsidiaries, manufactures and markets consumer products worldwide. The company has a P/E ratio of 19.9, equal to the average consumer non-durables industry P/E ratioand above the S&P 500 P/E ratio of 17.7. Colgate-Palmolive has a market cap of $47.46 billion and is part of the
industry. Shares are up 7.6% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.
TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.