The purpose of this memorandum is to summarize my analysis of Church and Dwight Co. and to provide my recommendation for the common stock of the company. This includes a current valuation range and 1 and 2 year expectations for recurring Earnings per Share and target stock price.
I recommend a hold for Church and Dwight Co.’s stock due to the slow predicted growth of the company’s 1 and 2 year expectations for recurring Earnings per Share shown in the table below. 2012 2013 2014 2015 2016 2017
$2.96 $2.79 $3.01 $3.07 $3.08 $3.09
The EPS for years 2016 and 2017 were predicted by taking an average of the growth rate of the Earnings per Share in years 2013, 2014, and 2015. The average growth rate was 1.13%; therefore that was used to grow the projected EPS figures. The current valuation range of the company is $2,025,860,000, which is the current 2015 Enterprise value. The enterprise value of Church and Dwight has grown since 2013. Although the enterprise value and expected EPS are both predicted to grow in the future, other valuation methods conducted show a decline in Church and Dwight’s growth.
Both the Earnings Retention Rate and the Sustainable Growth Rate have …show more content…
The company’s products are sold under a variety of brands thus offering the company a broad distribution platform. Despite the company establishing itself as a market leader, the company’s segments are highly competitive and the company faces competition both in the local, national, and international segments. As far as customers are concerned, the Company’s largest customer is Wal-Mart accounting for about 25% of the sales. Below you will find a graph of the company’s stock prices over the past 5 years. Once can conclude that they are continuing to grow and expand as a
I recommend a hold for Church and Dwight Co.’s stock due to the slow predicted growth of the company’s 1 and 2 year expectations for recurring Earnings per Share shown in the table below. 2012 2013 2014 2015 2016 2017
$2.96 $2.79 $3.01 $3.07 $3.08 $3.09
The EPS for years 2016 and 2017 were predicted by taking an average of the growth rate of the Earnings per Share in years 2013, 2014, and 2015. The average growth rate was 1.13%; therefore that was used to grow the projected EPS figures. The current valuation range of the company is $2,025,860,000, which is the current 2015 Enterprise value. The enterprise value of Church and Dwight has grown since 2013. Although the enterprise value and expected EPS are both predicted to grow in the future, other valuation methods conducted show a decline in Church and Dwight’s growth.
Both the Earnings Retention Rate and the Sustainable Growth Rate have …show more content…
The company’s products are sold under a variety of brands thus offering the company a broad distribution platform. Despite the company establishing itself as a market leader, the company’s segments are highly competitive and the company faces competition both in the local, national, and international segments. As far as customers are concerned, the Company’s largest customer is Wal-Mart accounting for about 25% of the sales. Below you will find a graph of the company’s stock prices over the past 5 years. Once can conclude that they are continuing to grow and expand as a