CL
Colgate-Palmolive Company
$93.10
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 108.2% above fair value
You pay
$93.10
Bear
$36.82
Fair
$44.71
Bull
$52.60
Bear
$36.82
-60.5%
$2.63 × 14x P/E
Fair
$44.71
-52.0%
$2.63 × 17x P/E
Bull
$52.60
-43.5%
$2.63 × 20x P/E
Adjust Assumptions
17.0x
2.63$
Key Value Driver
Normalized P/E multiple (17x base case)
Implied Market Multiple
35.4x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (45 analysts)
$100.14
Divergence from AlphaVal
55%
Summary
Applying a 17x P/E to adjusted EPS of $2.63, the base-case value is $44.71 per share. DDM cross-check: $39.74.
Warnings
The company pays out 80% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $100.14 (from 45 analysts). Our estimate is 55% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples