Colgate-Palmolive Company

🇺🇸New York Stock Exchange
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Colgate-Palmolive Company stock analysis CL overview
Slightly Bullish +15

Procter & Gamble vs. Colgate-Palmolive: One Dividend Giant Stands Above the Rest - 24/7 Wall St.

📊 P&G reported fiscal Q3 2026 core EPS of $1.59 on net sales of $21.235 billion, driven by 11% growth in Beauty and 7% in Grooming.

🦷 Colgate-Palmolive posted Q1 2026 adjusted EPS of $0.97 on revenue of $5.324 billion, with Oral, Personal, and Home Care rising 8.9%.

📉 P&G's core gross margin slipped 100 basis points due to roughly $400 million in after-tax tariff drag and $150 million in commodity headwinds.

🔄 Colgate is executing a Strategic Growth and Productivity Program with pretax charges of $350 million to $550 million targeting annual savings of $200 million to $300 million.

📈 P&G repurchased over $600 million in shares during Q3 with roughly $5 billion planned for fiscal year 2026.

💰 Colgate increased its dividend to $0.53 per share, though the stock trades at a premium of 35x trailing earnings.

🌍 P&G achieved broad-based growth across product categories and regions, with Fabric & Home Care delivering $7.403 billion in sales.

📉 Colgate's North America organic sales declined 1.8% with volume off 3.2%, representing a key area of concern for investors.

🐾 Hill's Pet Nutrition added $1.194 billion in revenue for Colgate, identified as the cleanest growth lane in the company's portfolio.

📈 P&G's 10-year total price return stands at 141.11%, supported by a 136-year dividend payment streak and deep free cash flow generation.

Bullish Signals
  • P&G demonstrated broad-based growth across product categories and regions, with Beauty growing 11% and Grooming adding 7%.
  • Colgate's Oral, Personal, and Home Care segments rose 8.9% to $4.131 billion, showing resilience in core businesses.
  • Hill's Pet Nutrition added $1.194 billion in revenue for Colgate, providing a clean growth lane amidst other challenges.
  • P&G repurchased over $600 million in shares during Q3 with roughly $5 billion planned for fiscal year 2026, signaling confidence.
  • Colgate recently increased its dividend to $0.53 per share, demonstrating commitment to shareholder returns despite restructuring costs.
Risk Factors
  • P&G's core gross margin slipped 100 basis points due to roughly $400 million in after-tax tariff drag and $150 million in commodity headwinds.
  • Colgate's North America organic sales declined 1.8% with volume off 3.2%, indicating a sore spot for the company's core business.
  • Colgate faces pretax charges of $350 million to $550 million under its Strategic Growth and Productivity Program, increasing short-term costs.
  • Colgate's gross margin guidance was revised lower because of tariffs, impacting future profitability expectations.
  • Colgate's advertising spend rose to $734 million from $668 million, indicating increased marketing pressure in a difficult operating environment.
Full Analysis
Procter & Gamble (PG) and Colgate-Palmolive (CL) recently released earnings reports that intensified investor debate regarding which dividend giant offers superior value. P&G reported fiscal Q3 2026 core EPS of $1.59 on net sales of $21.235 billion, driven by strong growth in Beauty (+11%), Grooming (+7%), and Fabric & Home Care ($7.403 billion). CEO Shailesh Jejurikar highlighted broad-based acceleration across categories, with Tide, Pampers, and Gillette providing significant volume support despite pricing contributing only one point to organic growth. In contrast, Colgate-Palmolive reported Q1 2026 adjusted EPS of $0.97 on revenue of $5.324 billion. While Oral, Personal, and Home Care segments rose 8.9% and Hill's Pet Nutrition added $1.194 billion, North America sales declined 1.8% due to a 3.2% volume drop. CEO Noel Wallace emphasized resilience in a difficult environment, but the company faces headwinds including revised gross margin guidance due to tariffs and increased advertising spend rising from $668 million to $734 million. Both companies are navigating cost pressures, with P&G facing roughly $400 million in after-tax tariff drag and $150 million in commodity headwinds that slipped core gross margins by 100 basis points. Colgate is executing its Strategic Growth and Productivity Program with pretax charges of $350 million to $550 million, targeting annual savings of $200 million to $300 million. P&G maintains a robust buyback program with over $600 million repurchased in Q3 and roughly $5 billion planned for FY26, while Colgate recently increased its dividend to $0.53 per share. Analysts lean toward P&G as the safer income play due to its 136-year dividend streak, deeper free cash flow, and a 10-year total price return of 141.11%. However, Colgate is viewed as an interesting turnaround opportunity if its restructuring efforts succeed and Hill's Pet Nutrition continues to compound growth. The primary risk for Colgate remains the North America market, where core brands are ceding shelf space to private label competitors, requiring a sustained volume inflection to justify its current valuation of 35x trailing earnings.