DCF Studio

    CL · NYQ · Consumer Defensive

    Colgate-Palmolive Company

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 86.92

    Market price

    USD 97.43

    Implied upside

    -10.8%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Value Per Share

    Perpetuity growth
    USD 86.92-10.8%
    Exit multiple
    USD 96.33-1.1%
    Market price
    USD 97.43

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn2bn4bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 21.4bnUSD 21.9bnUSD 22.4bnUSD 22.9bnUSD 23.5bnUSD 24.0bnUSD 24.6bnUSD 25.2bnUSD 25.8bnUSD 26.5bn+2.4%
    EBITUSD 4.5bnUSD 4.6bnUSD 4.7bnUSD 4.8bnUSD 4.9bnUSD 5.0bnUSD 5.1bnUSD 5.3bnUSD 5.4bnUSD 5.5bn+2.4%
    NOPATUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.8bnUSD 3.9bnUSD 4.0bnUSD 4.1bnUSD 4.2bnUSD 4.3bnUSD 4.4bn+2.4%
    Add depreciation & amortisationUSD 644.6mUSD 659.3mUSD 674.5mUSD 690.3mUSD 706.6mUSD 723.5mUSD 741.0mUSD 759.2mUSD 777.9mUSD 797.4m+2.4%
    Less capital expenditureUSD -698.4mUSD -734.3mUSD -771.7mUSD -810.7mUSD -851.3mUSD -893.5mUSD -937.6mUSD -983.5mUSD -1.0bnUSD -1.1bn+5.0%
    Capex, % of revenue3.3%3.4%3.4%3.5%3.6%3.7%3.8%3.9%4.0%4.1%-
    Less increase in working capitalUSD -90.7mUSD -43.6mUSD -45.1mUSD -46.7mUSD -48.3mUSD -50.1mUSD -51.8mUSD -53.7mUSD -55.6mUSD -57.6m-4.9%
    Free cashflow to firmUSD 3.4bnUSD 3.5bnUSD 3.5bnUSD 3.6bnUSD 3.7bnUSD 3.7bnUSD 3.8bnUSD 3.9bnUSD 3.9bnUSD 4.0bn+1.9%
    Discount factor0.96730.90520.84700.79260.74170.69400.64940.60770.56870.5321-
    Present valueUSD 3.3bnUSD 3.2bnUSD 3.0bnUSD 2.9bnUSD 2.7bnUSD 2.6bnUSD 2.5bnUSD 2.4bnUSD 2.2bnUSD 2.1bn-
    Present Value Of The ForecastUSD 26.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.536Reported 0.308, pulled toward 1.0 (Blume)
    Cost of equity7.16%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 15.9x interest cover. Book interest / average debt was lower, at 3.1%.
    Market capitalisationUSD 77.4bn90.1% of capital
    Total debtUSD 8.6bn9.9% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC6.87%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 86.92

    66% of EV

    Forecast FCFF, final year
    USD 4.0bn
    Capex at depreciation, working capital in reinvestment
    USD 4.4bn
    Less reinvestment at g/ROIC (6.5% of NOPAT)
    USD -283.9m
    Capitalised
    USD 4.1bn
    ROIC (reported)
    38.4%
    Terminal value, undiscounted
    USD 95.7bn
    Terminal value, discounted
    USD 50.9bn
    Enterprise value
    USD 77.8bn
    Less net debt
    USD 7.3bn
    Equity value
    USD 70.5bn

    Exit at 17.4x EBITDA

    Value per shareUSD 96.33

    69% of EV

    Terminal value, undiscounted
    USD 110.1bn
    Terminal value, discounted
    USD 58.6bn
    Enterprise value
    USD 85.4bn
    Less net debt
    USD 7.3bn
    Equity value
    USD 78.1bn

    Spread between methods: 10%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    4.87%126.87142.93165.85201.16262.46
    5.87%95.94104.07114.67129.03149.54
    6.87%76.5581.1886.9294.19103.67
    7.87%63.2666.1169.5173.6578.78
    8.87%53.5955.4257.5760.1063.14

    Outlined: this model. Green text: above today's price of 97.43. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year4.3%2.6%3.9%
    EBIT margin21.5%20.9%23.1%
    Discount rate-6.9%6.4%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.