Church & Dwight Co., Inc. (CHD) is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 28.42, higher than the industry average of 23.72 and the S&P 500's 21.81. This inflated valuation suggests that the market is pricing in high growth expectations, but it also raises questions about whether the company can deliver results that justify such a premium. CHD's Value Score of D adds to these concerns. Image Source: Zacks Investment Research Shares of Church & Dwight have dipped 3.8% in the ...

Church & Dwight Co., Inc. (CHD) continues to solidify its market position through a strong brand portfolio and adept pricing strategies. Its focus on expanding online sales has aligned with shifting consumer behaviors. However, the company faces challenges, including rising marketing expenses and a slowdown in consumer spending, which affected second-quarter 2024 results. Currency fluctuations pose a risk to the company's performance. Shares of the company have risen 7.9% in the past year compared with the ...

Investors in Church & Dwight Co., Inc. (CHD) need to pay close attention to the stock based on moves in the options market lately. That is because the Nov 15, 2024 $45.00 Put had some of the highest implied volatility of all equity options today. What is Implied Volatility? Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It c ...

Core Viewpoint - Church & Dwight Co. (CHD) is expected to have a rangebound share price in the near term until positive indicators emerge to support its ability to meet FY24 organic sales guidance [2][8] Company Overview - CHD develops, manufactures, and markets a variety of household, personal care, and specialty products, generating 90% of its revenue from the US and 10% from international markets [3] Earnings Results Update - In 2Q24, CHD reported total revenue of $1.51 billion, with organic sales growth of 4.7%, driven by a 9.3% increase in consumer international sales, while consumer domestic sales grew only 3.8% [4] - Gross margin was 45.4% and EBIT margin was 20.9%, leading to an operating EPS of $0.93 [4] Uncertainty in Meeting FY24 Guidance - CHD revised its FY24 organic sales outlook down to 4%, indicating a significant deceleration in growth from 1H24 [5] - The company experienced poor performance in June and July, with main categories growing only ~2% compared to 4.5% in the first five months of the year [5] - Mixed macroeconomic signals complicate the outlook for consumer spending, affecting investor sentiment towards CHD [5] Volume Growth Drivers - CHD's ability to drive volume growth hinges on macroeconomic recovery and successful innovation [6] - Recent product innovations, such as the Arm & Hammer liquid detergent and TheraBreath mouthwash, have shown promising market share gains [6] Valuation - CHD's stock trades at approximately 28x forward PE, which is considered expensive compared to peers like Procter & Gamble and Colgate-Palmolive, which trade at around 25x forward PE [7] - If CHD fails to meet its FY24 guidance, there is potential for the stock to decline to a 25x valuation [7] Conclusion - The path to achieving FY24 guidance for CHD remains uncertain due to mixed macroeconomic conditions, decelerating volume growth, and high valuation relative to peers [8]

GK Hart/Vikki Hart Church & Dwight Co. (NYSE:CHD), Inc. develops, manufactures, and markets household, personal care, and specialty products. It operates in three segments: Consumer Domestic, Consumer International, and Specialty Products Division. VAL Church & Dwight Co Inc (CHD) Price % Change SPDR® S&P 500® ETF Trust (SPY) Price % Change 5.76% 14.24% 16.00% 0.00% -8.00% Mar "24 May '24 Jul '24 Jan '24 Seeking AlphaQ Aug 2, 2024, 8:03 AM EDT Powered by YC H A R T S Data by Y Charts So far this year, CHD's ...

For the quarter ended June 2024, Church & Dwight (CHD) reported revenue of $1.51 billion, up 3.9% over the same period last year. EPS came in at $0.93, compared to $0.92 in the year-ago quarter. The reported revenue compares to the Zacks Consensus Estimate of $1.51 billion, representing a surprise of +0.21%. The company delivered an EPS surprise of +10.71%, with the consensus EPS estimate being $0.84. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Stree ...

[PART I - FINANCIAL INFORMATION](index=5&type=section&id=PART%20I) This section presents the company's financial statements, management's discussion and analysis, and disclosures on market risk and internal controls [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company reported strong Q2 and H1 2024 financial growth, with increased net sales, gross profit, and diluted EPS, supported by a robust balance sheet Q2 & H1 2024 Key Financial Performance (in millions, except per share data) | Metric | Q2 2024 | Q2 2023 | % Change | H1 2024 | H1 2023 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $1,511.2 | $1,454.2 | 3.9% | $3,014.5 | $2,884.0 | 4.5% | | **Gross Profit** | $712.1 | $638.9 | 11.5% | $1,399.1 | $1,260.9 | 11.0% | | **Income from Operations** | $336.9 | $293.6 | 14.7% | $641.9 | $585.5 | 9.6% | | **Net Income** | $243.5 | $221.2 | 10.1% | $471.2 | $424.4 | 11.0% | | **Diluted EPS** | $0.99 | $0.89 | 11.2% | $1.91 | $1.72 | 11.0% | Balance Sheet Summary (in millions) | Account | June 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **Total Current Assets** | $1,755.2 | $1,529.7 | | **Total Assets** | $8,762.1 | $8,569.2 | | **Total Current Liabilities** | $1,149.7 | $1,422.0 | | **Total Liabilities** | $4,456.6 | $4,713.8 | | **Total Stockholders' Equity** | $4,305.5 | $3,855.4 | Cash Flow Summary - Six Months Ended June 30 (in millions) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | **Net Cash Provided By Operating Activities** | $499.9 | $509.2 | | **Net Cash Used In Investing Activities** | $(91.5) | $(69.2) | | **Net Cash Provided By (Used In) Financing Activities** | $(257.4) | $(315.4) | | **Net Change In Cash and Cash Equivalents** | $147.2 | $126.6 | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail key accounting policies, including the Graphico, Inc. acquisition, potential impairment risks for VITAFUSION/LIL' CRITTERS and WATERPIK, and segment performance - On June 3, 2024, the Company acquired Graphico, Inc., a Japan-based distributor, for **$19.9 million** net of cash[34](index=34&type=chunk) - The VITAFUSION and LIL' CRITTERS trade name, with a carrying value of **$281.3 million**, is susceptible to future impairment risk due to continued market share decline, significant competition, and reduced shelf space[42](index=42&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - The global WATERPIK business has experienced a significant decline in customer demand due to lower discretionary spending and a shift to value-branded products, eroding the excess fair value over its carrying value of **$644.7 million** and making it susceptible to impairment[46](index=46&type=chunk)[47](index=47&type=chunk) Segment Net Sales & Income Before Taxes - H1 2024 vs H1 2023 (in millions) | Segment | H1 2024 Net Sales | H1 2023 Net Sales | H1 2024 Income | H1 2023 Income | | :--- | :--- | :--- | :--- | :--- | | **Consumer Domestic** | $2,335.8 | $2,245.1 | $512.4 | $459.4 | | **Consumer International** | $518.7 | $472.5 | $65.9 | $56.4 | | **SPD** | $160.0 | $166.4 | $22.1 | $16.0 | | **Corporate** | $0.0 | $0.0 | $4.2 | $6.4 | | **Total** | **$3,014.5** | **$2,884.0** | **$604.6** | **$538.2** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes Q2 net sales growth to volume and price/mix, with gross margin expanding significantly due to a tariff ruling and productivity, while maintaining strong liquidity and executing strategic transactions Consolidated Results Summary - Q2 2024 vs Q2 2023 | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $1,511.2M | $1,454.2M | +3.9% | | **Gross Margin** | 47.1% | 43.9% | +320 bps | | **Operating Margin** | 22.3% | 20.2% | +210 bps | | **Diluted EPS** | $0.99 | $0.89 | +11.2% | - A favorable tariff ruling from the U.S. government related to certain products imported from China resulted in a **$26.1 million** reduction in Cost of Goods Sold during the second quarter of 2024, contributing **180 basis points** to the gross margin increase[70](index=70&type=chunk)[76](index=76&type=chunk) - The company completed several strategic transactions in 2024: acquired Graphico, Inc. to expand in the APAC region, exited the MEGALAC supplement portion of its Animal Nutrition business, and sold its Passport food safety business[69](index=69&type=chunk) - As of June 30, 2024, the company had strong liquidity with **$491.7 million** in cash and approximately **$1.495 billion** available through its Revolving Credit Facility and commercial paper program[92](index=92&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Consolidated Q2 2024 net sales increased 3.9% driven by volume and price/mix, with gross margin expanding significantly due to a tariff ruling and productivity, alongside increased marketing and SG&A expenses Components of Net Sales Increase - Q2 2024 | Component | Contribution | | :--- | :--- | | Product volumes sold | 3.5% | | Pricing/Product mix | 1.2% | | Foreign exchange rate fluctuations | (0.1%) | | Exit of product lines (net of acquisition) | (0.7%) | | **Net Sales increase** | **3.9%** | - Q2 2024 gross margin increased by **320 basis points**, driven by a favorable tariff ruling (**180 bps**), productivity programs (**120 bps**), and favorable price/mix/volume (**80 bps**), partially offset by higher manufacturing costs (**50 bps**)[76](index=76&type=chunk) - Marketing expenses increased by **15.3%** to **$152.4 million** in Q2 2024, primarily to support new product introductions[77](index=77&type=chunk) [Segment Results](index=38&type=section&id=Segment%20results) Q2 2024 saw Consumer Domestic and International sales growth, while Specialty Products (SPD) sales decreased due to divestitures, though showing growth excluding these impacts - Consumer Domestic Q2 net sales increased **3.8%**, driven by strong performance from THERABREATH®, HERO® acne products, and ARM & HAMMER® Cat Litter, partially offset by declines in VITAFUSION® supplements and WATERPIK® Shower Heads[83](index=83&type=chunk) - Consumer International Q2 net sales grew **9.0%**, with a **4.6%** increase in volume and **4.7%** from price/mix[85](index=85&type=chunk)[86](index=86&type=chunk) - SPD Q2 net sales decreased **8.6%**, primarily due to a **12.5%** negative impact from exiting the MEGALAC and Passport businesses[89](index=89&type=chunk)[90](index=90&type=chunk) [Liquidity and Capital Resources](index=44&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with substantial cash and credit facility availability, repaid a term loan, increased its quarterly dividend, and expects operating cash flow to fund future needs - The company has a **$1.5 billion** unsecured revolving credit facility and a corresponding commercial paper program, with approximately **$1.495 billion** available as of June 30, 2024[92](index=92&type=chunk) - No stock was repurchased under the 2021 Share Repurchase Program in 2024, leaving **$658.9 million** available for repurchase[94](index=94&type=chunk) - The Board declared a **4%** increase in the quarterly dividend to **$0.28375 per share**, effective in Q1 2024[95](index=95&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=46&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section refers to the company's Annual Report on Form 10-K for detailed quantitative and qualitative disclosures regarding market risk - For information regarding market risk, the company directs investors to Item 7A of Part II in its Form 10-K[99](index=99&type=chunk) [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2024 - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by this report[100](index=100&type=chunk) - No changes in internal control over financial reporting occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[101](index=101&type=chunk) [PART II - OTHER INFORMATION](index=48&type=section&id=PART%20II) This section covers legal proceedings, risk factors, equity sales, other disclosures, and a list of exhibits [Legal Proceedings](index=48&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal actions and government proceedings in the ordinary course of business, with uncertain outcomes - The Company is subject to various pending or threatened legal actions and proceedings in the ordinary course of business, the outcomes of which are subject to many uncertainties[104](index=104&type=chunk) [Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the risk factors discussed in Item 1A of the company's Annual Report on Form 10-K, which could materially affect the company's business - The report directs readers to the 'Risk Factors' section in the company's Form 10-K for a detailed discussion of factors that could materially affect the business[105](index=105&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=50&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2024, the company did not repurchase any shares of its Common Stock, leaving $658.9 million available under the 2021 Share Repurchase Program - No shares of Common Stock were repurchased during Q2 2024 as part of the company's publicly announced plans[106](index=106&type=chunk)[107](index=107&type=chunk) - As of June 30, 2024, the company has **$658.9 million** remaining under its 2021 Share Repurchase Program authorization[106](index=106&type=chunk) [Other Information](index=50&type=section&id=Item%205.%20Other%20Information) During the three months ended June 30, 2024, none of the company's directors or executive officers adopted or terminated a Rule 10b5-1 trading plan - No directors or executive officers adopted or terminated any Rule 10b5-1 securities trading plans during the second quarter of 2024[108](index=108&type=chunk) [Exhibits](index=51&type=section&id=Item%206.%20Exhibits) This section provides an index of the exhibits filed with the Form 10-Q, including corporate governance documents and certifications - The Exhibit Index lists all documents filed with the report, such as the Certificate of Incorporation, By-laws, and CEO/CFO certifications[109](index=109&type=chunk)

Financial Data and Key Metrics Changes - Reported sales growth was 3.9%, exceeding the outlook of 3.5% due to strong results across domestic, international, and Specialty Products [3][4] - Organic sales grew 4.7%, surpassing the 4% Q2 outlook, with volume contributing 3.5% to growth [3][4] - Adjusted EPS was $0.93, which was $0.10 higher than the $0.83 outlook, driven by higher-than-expected sales growth and gross margin expansion [4][15] - Adjusted gross margin expanded by 150 basis points, with a reported gross margin of 47.1%, reflecting a one-time benefit from historical tariff payments [4][16] Business Line Data and Key Metrics Changes - U.S. consumer business saw 3.8% organic sales growth, with volume growth of 3.3%, marking the fourth consecutive quarter of volume growth [5][13] - The laundry detergent category, particularly ARM & HAMMER, outperformed with a consumption growth of 1.6% and achieved a record market share of 14.8% [6][7] - The gummy vitamins business continued to decline, with a 10.9% drop in consumption, despite a slight improvement in the overall category decline [9] - BATISTE experienced strong consumption growth of 14.5%, increasing its market share to 47% [10] Market Data and Key Metrics Changes - International business delivered organic growth of 9.3%, driven by strong performance in Canada, Mexico, and Germany [14] - Specialty Products saw organic sales increase by 3.9%, achieving two consecutive quarters of solid growth [14] Company Strategy and Development Direction - The company is focused on innovation, with new product launches contributing significantly to growth, particularly in the laundry detergent and personal care categories [6][10] - Management indicated a balanced portfolio of value and premium offerings is well-suited to changing consumer buying patterns [13] - The company is tightening its organic revenue outlook to approximately 4%, reflecting a moderation in consumption growth [19] Management's Comments on Operating Environment and Future Outlook - Management noted a slowdown in consumption growth in June and July, with expectations for slower category growth in the second half of the year [13][24] - The company remains optimistic about its brand strength and innovation capabilities to navigate the challenging environment [24][28] - Management expects full-year adjusted EPS growth in the range of 8% to 9%, now at the low end of the range due to increased SG&A expenses [19][20] Other Important Information - The company is actively exploring M&A opportunities, with cash building up on the balance sheet [63] - WATERPIK consumption is up high single to low double digits, indicating recovery from previous inventory issues [64] Q&A Session Summary Question: Insights on promotional backdrop and expectations for the year - Management noted a decrease in promotional activity in liquid laundry detergent, while litter saw an increase in promotional spending driven by competitors [21][22] Question: Clarification on the slowdown in June and July - Management indicated that the slowdown is broad-based across categories, with consumers becoming more price-conscious [24][30] Question: Discussion on dry powder for additional spending - Management confirmed that dry powder is reserved for potential promotional needs in household categories and vitamins if necessary [27][28] Question: Organic growth guidance and potential downside risks - Management acknowledged that the guidance assumes continued pressure on underlying category growth, with a focus on gaining market share [34][35] Question: Performance of THERABREATH and HERO brands - Management expressed confidence in THERABREATH's growth potential despite being a higher-priced product, while HERO continues to lead in the acne category [49][52] Question: Update on VMS segment and capacity changes - Management highlighted the competitive nature of the VMS category and ongoing efforts to innovate and improve consumer experience [58][59]

Core Viewpoint - Church & Dwight Co., Inc. (CHD) reported strong second-quarter 2024 results, with both earnings and net sales increasing year over year, driven by robust consumer demand across its portfolio [1] Financial Performance - Adjusted earnings were 93 cents per share, exceeding the Zacks Consensus Estimate of 84 cents, reflecting a 1.1% year-over-year increase [3] - Net sales reached $1,511.2 million, a 3.9% year-over-year increase, surpassing the Zacks Consensus Estimate of $1,508 million [4] - Organic sales grew by 4.7%, supported by a volume increase of 3.5% and a favorable product mix and pricing of 1.2% [4] Margin and Expenses - Gross margin expanded by 320 basis points to 47.1%, aided by a one-time benefit from a favorable tariff ruling [5] - Adjusted gross margin was 45.4%, up 150 basis points, driven by enhanced productivity and higher volume despite increased manufacturing costs [5] - Marketing expenses rose by $20.2 million year over year to $152.4 million, representing 10.1% of net sales, an increase of 100 basis points [6] Segment Performance - Consumer Domestic segment net sales increased by 3.8% to $1,170.6 million, driven by household and personal care sales growth [7] - Consumer International segment net sales rose by 9% to $263.7 million, with organic sales up 9.3% [8] - Specialty Products segment sales declined by 8.6% to $76.9 million, impacted by the winding down of the Megalac business [9] Future Guidance - The company adjusted its organic revenue growth forecast to about 4%, down from the previous range of 4-5% for 2024 [11] - Reported sales growth is projected to be around 3.5%, influenced by divestitures and adverse currency fluctuations [11] - Full-year adjusted gross margin expansion is now expected to be approximately 100-110 basis points, an increase from the previously expected 75 basis points [12] Earnings Outlook - The company anticipates reported earnings per share (EPS) growth in the range of 12-13%, up from the previous forecast of 9.5-10.5% [14] - For the third quarter of 2024, reported sales growth is expected to be about 2.5%, with organic sales growth of nearly 3% [15]

Core Viewpoint - Church & Dwight (CHD) reported quarterly earnings of $0.93 per share, exceeding the Zacks Consensus Estimate of $0.84 per share, and showing a slight increase from $0.92 per share a year ago, indicating a positive earnings surprise of 10.71% [1][2] Financial Performance - The company achieved revenues of $1.51 billion for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 0.21% and reflecting a year-over-year increase from $1.45 billion [2] - Over the last four quarters, Church & Dwight has consistently exceeded consensus EPS estimates [2] Stock Performance - Church & Dwight shares have increased approximately 5.8% since the beginning of the year, while the S&P 500 has gained 14.2%, indicating underperformance relative to the broader market [3] Future Outlook - The company's earnings outlook will be crucial for assessing future stock performance, with current consensus EPS estimates at $0.84 for the upcoming quarter and $3.46 for the current fiscal year [4][7] - The Zacks Rank for Church & Dwight is currently 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Soap and Cleaning Materials industry, to which Church & Dwight belongs, is currently ranked in the top 31% of over 250 Zacks industries, indicating a favorable industry outlook [8]