On Wednesday, Deutsche Bank (ETR:DBKGn) adjusted the price target for Colgate-Palmolive Company (NYSE:NYSE:CL) shares, bringing it down to $95 from the previous $100, while retaining a Hold rating on the stock.
The revision comes as the analyst anticipates the company to deliver fourth-quarter results for 2024 that align with expectations, projecting around a 6% increase in organic growth.
The analyst noted that despite the expected in-line quarter, they have modeled results slightly below the consensus due to increasing foreign exchange (FX) headwinds towards the end of the fiscal year 2024. These headwinds are coupled with a slowdown in certain global end markets. Consequently, Deutsche Bank has lowered its adjusted earnings per share (EPS) estimate for the fourth quarter to $0.87, a decrease from the prior $0.89 and below the consensus of $0.89.
Looking ahead to fiscal year 2025, the forecast is tempered by the expectation that Colgate-Palmolive will continue to invest in the business, which may result in setting initial organic growth targets at no more than approximately 5%. With these factors in mind, the analyst predicts that the company will guide towards low single-digit adjusted EPS growth as a base case for the upcoming year.
For fiscal year 2025, the analyst has reduced the EPS forecast to $3.65, which is a decrease from the previous estimate of $3.77. This represents an approximate 2.5% year-over-year growth, which is less optimistic than the current consensus of $3.83. The revised figures reflect the analyst's cautious stance in light of the challenging FX environment and the company's strategic spending plans.
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