Is Colgate-Palmolive Company (CL) the Best Defensive Stock to Buy Right Now?

Colgate-Palmolive Company (CL) has long been a favorite among investors seeking defensive stocks, and for good reason. The oral care and household products giant has consistently demonstrated resilience and strong performance, even in challenging economic conditions. As we approach the end of 2025, the question remains: is CL still the best defensive stock to buy right now?



Colgate-Palmolive's diverse product portfolio and global presence contribute significantly to its resilience during economic downturns. The company's extensive range of oral care, personal care, and home care products ensures consistent demand, even in challenging economic conditions. This is evident in the company's performance during the 2023 economic downturn, where it maintained strong performance and cash flow (Source: "Southern Company, Amazon, Colgate-Palmolive, and McDonald's have demonstrated resilience during economic downturns.").

Colgate-Palmolive's global presence, particularly its strong presence in Latin America, which accounts for approximately 25% of total sales, provides a balanced revenue mix that enhances resilience against localized downturns. This is highlighted in the company's third-quarter 2024 results, where net sales increased by 2.4% year-over-year, driven by a 3.7% rise in overall volume (Source: "Colgate-Palmolive Company (NYSE:CL) today reported results for third quarter 2024.").

The company's ability to maintain gross margin expansion, despite economic headwinds, further demonstrates its resilience. In the third quarter of 2024, Colgate-Palmolive's gross margin expanded by 260 basis points to 61.1%, indicating the company's ability to manage costs and maintain profitability during economic downturns (Source: "Colgate-Palmolive Company (NYSE:CL) today reported results for third quarter 2024.").

Colgate-Palmolive's strong financial performance and resilience make it an attractive defensive stock. However, it is essential to consider potential risks and challenges. The company faces competition in various markets, and changes in consumer preferences and economic conditions can impact its performance. Additionally, foreign exchange headwinds can negatively impact net sales and gross margin, posing a challenge to earnings growth.

In conclusion, Colgate-Palmolive Company (CL) remains a strong contender for defensive stocks, given its diverse product portfolio, global presence, and demonstrated resilience during economic downturns. However, investors should remain vigilant and monitor the company's performance, as well as the broader economic landscape, to make informed decisions.