Colgate-Palmolive's Price Target Reduced to $90 by TD Cowen Amid Restructuring Plan

Colgate-Palmolive's 2Q results were broadly in line, but management lowered sales guidance to the lower end of the 2-4% range. TD Cowen has lowered its price target to $90 from $100 and maintains a Buy rating. The company announced a three-year restructuring program to optimize the supply chain and streamline the organization.

Colgate-Palmolive Company (CL) reported its second-quarter 2025 earnings, with results broadly in line with expectations. The company saw earnings per share (EPS) of $0.92, up 1% from the prior-year period, and net sales of $5.11 billion, up 1% year over year [1].

The company's organic sales growth was 1.8%, driven by a 0.2% drop in organic volume and a 2% improvement in pricing. The company maintained its leadership in the toothpaste market with a 41.1% global market share year to date and continued to lead the manual toothbrush market with a 32.4% global market share year to date [1].

Colgate-Palmolive's gross profit margin decreased by 70 basis points to 60.1%, and its adjusted operating profit margin contracted by 80 basis points to 21.3% [1]. The company's cash and cash equivalents stood at $1.22 billion, and its total debt was $8.8 billion [1].

Despite the positive results, Colgate-Palmolive lowered its full-year organic sales growth forecast to the lower end of its previous 2-4% guidance range. The company expects net sales to grow in low single digits, with a flat to low-single-digit adverse impact of foreign exchange. On a non-GAAP (Base Business) basis, Colgate expects gross profit margin and advertising to be nearly flat as a percentage of sales, and EPS to grow by low single digits [1].

In response to the results, TD Cowen lowered its price target to $90 from $100 and maintains a Buy rating. The company also announced a three-year restructuring program to optimize the supply chain and streamline the organization [2].

References:
[1] https://finance.yahoo.com/news/colgate-tops-q2-earnings-sales-151300813.html
[2] https://site.financialmodelingprep.com/market-news/colgate-palmolive-q2-2025-earnings-adjusts-sales-growth-forecast