Introduction
Colgate Palmolive Company
is a widely known and recognized American multinational company, which
produces, distributes, or provides healthcare, personal, and household products
such as soaps, toothpastes, detergents etc. Founded in 1806, CL is today world’s one of the largest
consumer products companies with respect to market share. Colgate Palmolive
operates in six continents today and plans to further grow to cover the entire
world.
Business Overview
In 1806, William Colgate started a factory, which made soap
and candles. In 1872 and 1873 the company launched two new products viz.
Cashmere Bouquet, a perfumed soap and Colgate Ribbon Dental Cream, its first
tubular toothpaste respectively. In 1928 Colgate Company merged into Palmolive
– Peet making Colgate – Palmolive – Peet, which in 1953 was renamed as Colgate Palmolive Company. Since then
CL has grown like a tree, expanding and strengthening its market share and
sales. Oral Care products from the company are their flagship products bringing
in the largest share of CL
earnings. Two other categories, which compromise majority of the CL earnings, are the personal care and
home care. Its entire global economics have been divided into five main divisions,
which are Latin America, Europe/South Pacific, North America, Greater Asia/
Africa and Hill’s Pet nutrition.
Colgate Palmolive
Stock
The Colgate Palmolive
stock has been listed in only two countries in the world, which are United
States and India. On March 13, 1980 Colgate got listed for the first time on
the New York Stock Exchange.
Since its listing, the CL stock has
gained importance in the stock market and has become one of the most sought
after stocks in the consumer products category. Starting with a CL stock
price of around $1 per share, the CL
stock has gained through the times and as of January 2014 CL stock price has reached $62.68. If
we talk about the Indian markets like the BSE or Bombay Stock Exchange and NSE
or National Stock Exchange, the Colgate
Palmolive Stock Price has reached around Rs. 1300 for both the indices.
Since its inception, the Colgate
Palmolive Stock Price has shown steady increase despite some instances when
the prices fell due to market instability and volatility. Keeping in mind the
future strategies of the company and a historical CL stock
analysis it would be safe to say that this company would be one to
watch out for.
Latin American
Influence
Colgate Palmolive’s most important market division is Latin
America. Out of the five major divisions Latin America provides 28-29% annual
sales for the company. If the statistics for the third and fourth quarter of
2013 are looked at, the picture could be understood more clearly. The organic
sales which means net sales minus foreign exchange, acquisitions and
divestments, recorded a rise of 6.5%. CL
estimates show that the gross profit margin jumped to 58.9% whereas the net
income declined by 5% to $564 million due to heavy expenditure on
advertisements. Now this growth in organic sales was largely due to the
company’s Latin American dominance. This region is like the crown jewel for
Colgate Palmolive and registered an organic sale growth of 12.5% ending 2013. A
net sales increase of 1% and unit volume gains of up to 10% are a gauge of
Colgate’s dominance in regions like Brazil, Colombia, Mexico and Venezuela. The
company dominated all categories or areas in Latin America. It maintained peak
position in manual toothbrushes and toothpaste region as shown by the CL estimates which showed an 80% market
share in Mexico and volume growth in places like Chile, Uruguay, Brazil, Puerto
Rico and the Dominican Republic. Making great progress in the mouthwash
category they gained on the leaders considerably. Oral care dominance by the
company continued throughout. This region is the single largest revenue
generator for the company and thus it can be easily said to be the driving
force behind growth of the company. The ever increasing profits derived from
this region have also led to some fears. A Colgate
Palmolive Stock analysis shows that the company might have reached a kind
of saturation in this vital region. Moreover due to the high dependence on this
region CL stock analysis fears that an
economic slowdown in Latin American market could have huge repercussions on the
entire company. But the company heads are positive and feel that they still
have scope to do better in Latin America.
Using innovations and new product launches they plan to keep a firm grip
on the market. Periodic launches of new products with innovative concepts keeps
the consumers’ attention and curiosity directed towards the company, which is
one of the main reasons for continuous and sustained growth in volumes for the
brand. Anyone who has doubts about the company’s prowess of maintaining its
strong leadership may do a complete Colgate
Palmolive Stock Analysis and reassure themselves.
Conclusion
Many corporate experts may bring out CL stock news and future predictions as to where the company is
heading but as Colgate Palmolive Stock
News from recent times suggests that dividends from this company are always
a positive, thus any CL stock news
saying that this company has reached a saturation needs to think again.
Bottom Line
Keeping in mind their complete control over the market
shares and volumes in sectors like toothpaste and toothbrushes and the steady
increase that their numbers have shown one can easily say that any Colgate
Palmolive Stock News is good news. Latin America is the driving factor
which makes this company move forward and provides the stable foundation needed
to build an empire. Colgate Palmolive is an undisputed leader in this division
which gives them the required confidence and impetus to experiment, innovate
and expand their reach. Without their Latin American dominance this company
could not have been where it is today. But for the future they also need to
look across continents and harness the potential markets like Asia Pacifica and
Europe. Who knows they may stumble upon some more Latin American gems for
themselves.
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