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Church & Dwight to Grow on Organic Sales, International Unit
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Church & Dwight Co., Inc. (CHD - Free Report) is worth a look, given its robust international consumer business and impressive organic sales trend among other growth drivers. These factors, which helped the company retain its solid earnings surprise trend in first-quarter 2018, are expected to fuel growth further at the Zacks Rank #2 (Buy) company.
While Church & Dwight has gained 4% in the past six months, it has fared much better than the industry that has tumbled 8.7%. So, let’s delve deep into the factors that have been propelling Church & Dwight.
International Consumer Unit Strength
Church & Dwight has long been gaining from strength at its International Consumer unit. In first-quarter 2018, organic sales in the international segment jumped 6.8%, courtesy of higher volumes, and improved pricing and mix.
Further, overall international sales surged 26.3%, receiving considerable impetus from OXICLEAN in the export business; STERIMAR, ARM & HAMMER toothpaste and OXICLEAN in Mexico; and FEMFRESH and BATISTE in Australia. Further, the company is opening new offices in order to support increase in export business and expects this business to remain strong. Also, it is making considerable investments in Southeast Asia and China, which is likely to be a major growth driver in the future.
Impressive Organic Sales Trend
Church & Dwight has been witnessing organic sales growth for quite some time now, backed by its solid focus on product innovations. Evidently, organic sales grew 3.8% in the first quarter of 2018. Further, organic sales jumped 2.3%, 1.8%, 3.2% and 3.4% in first, second, third and fourth-quarter 2017, respectively. In the first quarter, organic sales growth was driven by a 4.2% rise in global consumer products’ growth, which in turn was fueled by higher volumes. In 2018, management expects organic sales to grow more than 3%.
Buyouts Remain a Major Growth Driver
The company, which started with only one brand, i.e. ARM & HAMMER, has acquired a number of premium high-margin brands over time. These businesses have been boosting the company’s revenues, which are expected to reach $4 billion in 2018 from $1.5 billion in 2004. In this regard, Church & Dwight recently acquired Waterpik, which contributed significantly to its sales in the first quarter. Management expects sales from Waterpik to increase in high single digits in 2018. The company's other acquisitions include Agro BioSciences in May and VIVISCAL business in January 2017. Prior to that, the acquisitions of ANUSOL and RECTINOL brands from Johnson & Johnson in December 2016 helped the company boost its business internationally.
A Glimpse of Q1 & Looking Ahead
The aforementioned factors, along with Church & Dwight’s strong brand portfolio and focus on innovations, helped it to post solid first-quarter 2018 results. Both the top and bottom line grew year over year and topped the Zacks Consensus Estimate, marking the company’s sixth and third consecutive quarter of positive earnings and sales surprise, respectively. Moving ahead, Church & Dwight’s stable portfolio of value and premium products, launch of new and innovative products, and aggressive productivity programs are expected to keep driving its performance.
Management expects solid volume growth and improved market share to drive 2018 results. Consequently, the company raised its sales outlook and now expects 2018 reported sales to grow about 9%. Benefits from tax reforms are still expected to boost bottom-line growth. The company’s estimated earnings per share of $2.24-$2.28 reflect 16-18% growth in 2018.
Looking for More? Check These Solid Consumer Staples Stocks
United Natural Foods (UNFI - Free Report) , with long-term earnings per share growth rate of 8.2%, flaunts a Zacks Rank #2.
Conagra Brands (CAG - Free Report) , with long-term earnings per share growth rate of 8%, carries a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
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Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Church & Dwight to Grow on Organic Sales, International Unit
Church & Dwight Co., Inc. (CHD - Free Report) is worth a look, given its robust international consumer business and impressive organic sales trend among other growth drivers. These factors, which helped the company retain its solid earnings surprise trend in first-quarter 2018, are expected to fuel growth further at the Zacks Rank #2 (Buy) company.
While Church & Dwight has gained 4% in the past six months, it has fared much better than the industry that has tumbled 8.7%. So, let’s delve deep into the factors that have been propelling Church & Dwight.
International Consumer Unit Strength
Church & Dwight has long been gaining from strength at its International Consumer unit. In first-quarter 2018, organic sales in the international segment jumped 6.8%, courtesy of higher volumes, and improved pricing and mix.
Further, overall international sales surged 26.3%, receiving considerable impetus from OXICLEAN in the export business; STERIMAR, ARM & HAMMER toothpaste and OXICLEAN in Mexico; and FEMFRESH and BATISTE in Australia. Further, the company is opening new offices in order to support increase in export business and expects this business to remain strong. Also, it is making considerable investments in Southeast Asia and China, which is likely to be a major growth driver in the future.
Impressive Organic Sales Trend
Church & Dwight has been witnessing organic sales growth for quite some time now, backed by its solid focus on product innovations. Evidently, organic sales grew 3.8% in the first quarter of 2018. Further, organic sales jumped 2.3%, 1.8%, 3.2% and 3.4% in first, second, third and fourth-quarter 2017, respectively. In the first quarter, organic sales growth was driven by a 4.2% rise in global consumer products’ growth, which in turn was fueled by higher volumes. In 2018, management expects organic sales to grow more than 3%.
Buyouts Remain a Major Growth Driver
The company, which started with only one brand, i.e. ARM & HAMMER, has acquired a number of premium high-margin brands over time. These businesses have been boosting the company’s revenues, which are expected to reach $4 billion in 2018 from $1.5 billion in 2004. In this regard, Church & Dwight recently acquired Waterpik, which contributed significantly to its sales in the first quarter. Management expects sales from Waterpik to increase in high single digits in 2018. The company's other acquisitions include Agro BioSciences in May and VIVISCAL business in January 2017. Prior to that, the acquisitions of ANUSOL and RECTINOL brands from Johnson & Johnson in December 2016 helped the company boost its business internationally.
A Glimpse of Q1 & Looking Ahead
The aforementioned factors, along with Church & Dwight’s strong brand portfolio and focus on innovations, helped it to post solid first-quarter 2018 results. Both the top and bottom line grew year over year and topped the Zacks Consensus Estimate, marking the company’s sixth and third consecutive quarter of positive earnings and sales surprise, respectively. Moving ahead, Church & Dwight’s stable portfolio of value and premium products, launch of new and innovative products, and aggressive productivity programs are expected to keep driving its performance.
Management expects solid volume growth and improved market share to drive 2018 results. Consequently, the company raised its sales outlook and now expects 2018 reported sales to grow about 9%. Benefits from tax reforms are still expected to boost bottom-line growth. The company’s estimated earnings per share of $2.24-$2.28 reflect 16-18% growth in 2018.
Looking for More? Check These Solid Consumer Staples Stocks
MEDIFAST INC (MED - Free Report) , a Zacks Rank #1 (Strong Buy), delivered positive earnings surprises in the past three quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.
United Natural Foods (UNFI - Free Report) , with long-term earnings per share growth rate of 8.2%, flaunts a Zacks Rank #2.
Conagra Brands (CAG - Free Report) , with long-term earnings per share growth rate of 8%, carries a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>