Church & Dwight
CHD
$108.86
+3.68%
Church & Dwight Co., Inc. is a consumer staples manufacturer whose portfolio spans baking soda, laundry detergent, cat litter, oral care, deodorant, and nasal care, sold primarily under the Arm & Hammer, OxiClean, Batiste, Hero, and TheraBreath brands, with roughly 80% of sales generated in the United States. The company is best characterized as a disciplined, brand-accretive consolidator in household and personal products — a premium-priced staple compounder that grows through a mix of modest organic volume, price/mix, and serial bolt-on acquisitions rather than through category disruption. The current investor debate centers on whether that model can reaccelerate: the 2025 addition of Touchland's hand sanitizer business and the ongoing integration of Hero and TheraBreath have raised questions about acquisition-driven growth versus underlying organic momentum, while a soft revenue print in the most recent quarter (roughly 1.6% year-over-year growth) has sharpened scrutiny on volume trends and gross margin durability. With the stock pressing against 52-week highs despite tepid top-line growth, the narrative has shifted toward margin expansion, cash flow resilience, and the defensive appeal of a low-beta staple in an uncertain macro backdrop.…
CHD
Church & Dwight
$108.86
Investment Opinion: Should I buy CHD Today?
Rating: Hold. The core thesis is that Church & Dwight is a high-quality defensive compounder with strong cash flow and a low beta, but the stock is fully valued at 27.58x trailing earnings with an average analyst target of $104.63 implying essentially zero upside. The consensus rating of 2.24 (buy) is only moderately constructive, and the wide target range of $78–$115 reflects uncertainty about growth.\n\nSupporting evidence includes: (1) revenue growth of just 1.57% in Q2 2026, which is below the sector average and insufficient to justify a premium multiple; (2) gross margin expansion to 45.35% from 42.95%, showing pricing power; (3) robust free cash flow of $1.115 billion TTM, covering the 1.41% dividend with a 38.98% payout ratio; and (4) a low beta of 0.482, offering downside protection. However, the forward PE of 25.92x and EV/EBITDA of 17.04x are rich for a low-growth staple, and the PEG of 1.01 provides no valuation cushion.\n\nThe biggest risks are a continued slowdown in organic growth, margin pressure from input costs, and multiple compression. The rating would upgrade to Buy if organic growth accelerates above 3% and the PE compresses below 24x, or if the stock pulls back toward the $90–$95 range (where it consolidated in September) providing a better entry point. It would downgrade to Sell if revenue growth turns negative or if gross margins fall below 43%. Relative to its history and peers, the stock appears fairly valued to slightly overvalued, with limited near-term upside.
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CHD 12-Month Price Forecast
The risk/reward is balanced but uninspiring: the stock is fairly valued with limited upside to consensus targets, and growth is anemic. The defensive qualities (low beta, strong FCF, dividend) are already priced in, leaving little margin of safety. An upgrade to bullish would require evidence of organic reacceleration above 3% and a more attractive entry point; a downgrade to bearish would follow a negative revenue print or margin compression below 43%.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Church & Dwight's 12-month outlook, with a consensus price target around $104.63 and implied upside of -3.9% versus the current price.
Average Target
$104.63
0 analysts
Implied Upside
-3.9%
vs. current price
Analyst Count
—
covering this stock
Price Range
$78 - $115
Analyst target range
Coverage is broad, with 19 analysts following the stock, and the consensus recommendation is "buy" with a mean rating of 2.24 on a scale where lower is more bullish — a moderately constructive but not enthusiastic stance. The average target price of $104.63 is essentially at the current price of $104.53, implying roughly 0.1% upside — meaning the stock has already run to consensus fair value after its 26.49% YTD gain, and the consensus leans neutral-to-cautiously-bullish rather than strongly bullish.
The target range of $78.00 to $115.00 is wide — a 47% spread from low to high — signaling meaningful disagreement about the growth trajectory. The high target of $115 (about 10% above the current price) likely assumes successful Touchland and Hero integration, margin expansion toward the high end of guidance, and a re-rating toward the upper end of the historical PE band, while the low target of $78 (about 25% below current) prices in volume deterioration, margin compression from input costs, and multiple contraction toward the low-20s. Recent institutional actions show a split tape: RBC Capital and Wells Fargo maintain Outperform/Overweight, while Barclays remains Underweight and UBS, Citigroup, JP Morgan, and TD Cowen sit at Neutral/Hold — a pattern of stable ratings with no recent upgrades, suggesting analysts are waiting for evidence of organic reacceleration before raising targets, and the wide dispersion argues for position sizing discipline given the stock's low beta but full valuation.
Bulls vs Bears: CHD Investment Factors
The bear case currently has stronger evidence: revenue growth of just 1.57% is insufficient to justify a 27.58x trailing PE and 25.92x forward PE, and the analyst consensus target of $104.63 offers no upside from the current $104.53 price. The bull case rests on quality factors—low beta (0.482), robust FCF ($1.115 billion TTM), and gross margin expansion to 45.35%—but these are already reflected in the premium valuation. The single most important tension is whether organic growth can reaccelerate above 3-4% through successful integration of Touchland and Hero and a rebound in domestic volumes; without that, the stock is vulnerable to multiple compression. Momentum is strong (up 26.49% YTD), but the risk/reward is skewed to the downside given the lack of analyst upside and full valuation.
Bullish
- Defensive low-beta compounder: CHD's beta of 0.482 means it is roughly half as volatile as the market, and it has still delivered a 19.81% one-year gain versus the S&P 500's 15.53%. This combination of market-beating return with below-market risk is rare and supports a premium multiple for risk-averse portfolios.
- Robust free cash flow and dividend coverage: Trailing-twelve-month free cash flow is $1.115 billion, comfortably covering the ~$72–73 million quarterly dividend (payout ratio 38.98%, yield 1.41%). Quarterly FCF of $256.9 million in Q2 2026 and $308.2 million in Q4 2025 demonstrates consistent cash generation even amid soft revenue growth.
- Gross margin expansion: Q2 2026 gross margin improved to 45.35% from 42.95% a year earlier, and the trailing gross margin of 44.73% is solid for household products. This pricing power and mix benefit (including acquired brands like Touchland and Hero) supports earnings resilience even with low volume growth.
- Strong balance sheet and returns: Debt-to-equity is a conservative 0.551, ROE is 18.41%, and ROA is 7.87%. The company funds bolt-on M&A ($160.7 million in Q2 2026) from operating cash flow ($286.8 million in Q2) rather than stretching the balance sheet, preserving financial flexibility.
Bearish
- Anemic organic growth: Q2 2026 revenue grew only 1.57% year-over-year to $1.530 billion, and Q1 2026 was essentially flat versus Q1 2025. Growth is being carried by acquisitions and price/mix rather than volume, raising questions about the sustainability of the model.
- Premium valuation for low growth: The stock trades at 27.58x trailing earnings and 25.92x forward earnings, with EV/EBITDA of 17.04x and price-to-sales of 3.28x. For a company growing revenue at just 1.6%, these multiples are full and leave little room for error; the PEG of 1.01 offers no valuation cushion.
- Analyst target implies no upside: The average analyst target price of $104.63 is essentially equal to the current price of $104.53, implying 0.1% upside. The consensus rating of 2.24 (buy) is only moderately constructive, and the wide target range of $78–$115 (47% spread) signals significant disagreement about the growth trajectory.
- Margin volatility and one-time charges: Q4 2025 net margin collapsed to 8.73% from 11.96% in Q4 2024 due to a $77.9 million other-expense hit, and operating margin has fluctuated from 19.81% in Q1 2026 to 16.18% in Q4 2025. This sensitivity to charges and input costs undermines earnings predictability.
CHD Technical Analysis
Church & Dwight is in a sustained uptrend, with the shares up 19.81% over the past year and 26.49% year-to-date, materially outpacing the S&P 500's 15.53% and 11.93% respective gains. At a current price of $104.53 against a 52-week range of $81.33 to $106.04, the stock is trading at approximately 94% of its 52-week range — a positioning that signals strong momentum but also leaves little cushion, with the price sitting just 1.4% below the 52-week high. This near-high posture implies the market has already priced in a favorable outcome and that incremental upside now requires either a breakout to new highs or continued earnings delivery.
Short-term momentum is clearly accelerating: the stock has gained 9.44% over the past month versus a 1.22% rise in SPY, a relative strength spread of 8.22 percentage points, and is up 6.59% over three months against SPY's 2.69%. The 1-month gain exceeds both the 3-month (6.59%) and 6-month (7.90%) changes, indicating the trend is steepening rather than decelerating, and the 1-year relative strength of 4.28 points confirms persistent outperformance. Notably, the 6-month relative strength of just 0.42 points shows the stock was roughly market-performant through the spring before this autumn surge — a re-acceleration pattern that typically reflects fresh fundamental catalysts or defensive rotation rather than a mean-reversion bounce.
Key technical levels are well defined: support sits at the 52-week low of $81.33, roughly 22% below the current price, with intermediate support likely in the $94–$96 zone where the stock consolidated in September, while resistance is the 52-week high of $106.04, only 1.4% above the current $104.53. A clean breakout above $106 would confirm the uptrend and likely invite momentum buying, whereas a failure and breakdown below $94 would signal a failed breakout and expose the $81.33 low. The beta of 0.482 is the critical risk-management input here — the stock is roughly half as volatile as the market, meaning its 19.81% one-year gain was achieved with far less price risk than an index-tracking position, but also that upside torque on any breakout will be muted relative to high-beta names.
Beta
0.48
0.48x market volatility
Max Drawdown
-13.8%
Largest decline past year
52-Week Range
$81-$109
Price range past year
Annual Return
+23.5%
Cumulative gain past year
| Period | CHD Return | S&P 500 |
|---|---|---|
| 1m | +13.3% | -1.2% |
| 3m | +11.5% | +3.4% |
| 6m | +14.6% | +7.0% |
| 1y | +23.5% | +14.4% |
| ytd | +31.7% | +12.0% |
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CHD Fundamental Analysis
Revenue growth is modest and decelerating: the most recent quarter (Q2 2026, ended June 30) delivered $1.530 billion in revenue, up just 1.57% year-over-year from $1.506 billion, a sharp slowdown from the prior-year comparison. The multi-quarter trend is uninspiring — Q1 2026 revenue of $1.469 billion was essentially flat versus Q1 2025's $1.467 billion, and Q4 2025's $1.644 billion compared to $1.582 billion in Q4 2024 — implying that recent growth is being carried by acquisitions (Touchland) and price/mix rather than volume. Segment data for the latest period shows Consumer Domestic at $1.156 billion, Consumer International at $297.5 million, and Specialty Products at $76.7 million, confirming that the domestic business (~76% of sales) is the swing factor; with only 1.6% total growth, the investment case depends on international and acquired brands outgrowing a mature domestic base.
Profitability remains solid but is compressing at the operating line: Q2 2026 net income was $202.8 million on a 13.25% net margin, down from $191.0 million and a 12.68% margin in Q2 2025, while gross margin improved to 45.35% from 42.95% a year earlier. However, operating income fell to $276.4 million (18.07% operating margin) from $261.7 million (17.37%) — actually an improvement — but the sequential trend is concerning, with Q1 2026 operating margin at 19.81% and Q4 2025 at just 16.18%, reflecting a $77.9 million other-expense hit in Q4. The trailing gross margin of 44.73% and operating margin of 17.37% are consistent with premium branded household products, and the 11.88% net margin is respectable for the category, but the Q4 2025 net margin collapse to 8.73% (from 11.96% in Q4 2024) shows how sensitive earnings are to one-time charges and input costs.
The balance sheet is conservatively managed: debt-to-equity stands at 0.551, the current ratio is 1.066, and ROE is a healthy 18.41% with ROA of 7.87%. Free cash flow is robust — $1.115 billion on a trailing-twelve-month basis, with quarterly FCF of $256.9 million in Q2 2026, $142.9 million in Q1 2026, and $308.2 million in Q4 2025 — comfortably covering the ~$72–73 million quarterly dividend (payout ratio 38.98%, yield 1.41%) and funding bolt-on M&A such as the $160.7 million of acquisitions in Q2 2026. The main watch item is liquidity: cash fell to $254.8 million at the end of Q2 2026 from $503.4 million at the start of the period after $328.4 million of investing outflows, and the current ratio of 1.066 is thin for a staples company, meaning the company relies on its strong operating cash flow ($286.8 million in Q2) rather than a cash cushion to fund growth.
Quarterly Revenue
$1.5B
2026-06
Revenue YoY Growth
+1.6%
YoY Comparison
Gross Margin
45.4%
Latest Quarter
Free Cash Flow
$1.1B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is CHD Overvalued?
Because Church & Dwight is solidly profitable (Q2 2026 net income of $202.8 million; TTM EPS positive), the PE ratio is the appropriate primary metric. The stock trades at 27.58x trailing earnings and 25.92x forward earnings, a modest 6% compression that implies the market expects only modest earnings growth — consistent with the consensus EPS estimate of $4.82 and the PEG ratio of 1.01, which suggests the multiple is roughly in line with the company's growth rate rather than stretched relative to it.
Against the household and personal products sector, the valuation is full: the trailing PE of 27.58x, forward PE of 25.92x, price-to-sales of 3.28x, price-to-book of 5.08x, and EV/EBITDA of 17.04x all sit at premium levels for a staples manufacturer growing revenue at just 1.6%, with the EV/Sales of 4.27x particularly rich given the low-single-digit top line. The premium is defensible on quality grounds — 18.41% ROE, 44.73% gross margin, and a fortress-like 0.482 beta — but the PEG of 1.01 and the 1.41% dividend yield offer little valuation support if growth does not reaccelerate, and the 16.74x price-to-cash-flow multiple underscores that investors are paying up for cash generation.
Historically, the stock's PE has ranged from roughly 21.96x (Q3 2021) to 39.42x (Q4 2021), with the trailing 27.58x sitting near the middle of that band and well below the 2021 peak, while the price-to-sales of 3.28x is near the low end of its historical 13–18x range on the quarterly series — though that series reflects a different share-count and reporting basis and should be treated cautiously. The more reliable read is that the current 27.58x PE is close to the 2024–2025 average of roughly 28–31x, implying the market is pricing in steady-state execution rather than either euphoria or distress, leaving limited multiple-expansion upside and making earnings delivery the primary driver of returns from here.
PE
27.6x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 22x~38x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
17.0x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on decelerating revenue growth and margin volatility. Q2 2026 revenue grew only 1.57% year-over-year, and Q1 2026 was flat, indicating that acquisitions and price/mix are masking weak organic volume. Operating margin has been volatile, swinging from 19.81% in Q1 2026 to 16.18% in Q4 2025 due to a $77.9 million other-expense charge, and the Q4 2025 net margin collapse to 8.73% shows earnings sensitivity to one-time items. Additionally, the current ratio of 1.066 is thin, and cash fell by nearly half to $254.8 million in Q2 2026, leaving less buffer for unexpected costs or further M&A.\n\nMarket and competitive risks include valuation compression and sector rotation. At 27.58x trailing earnings and 25.92x forward earnings, CHD trades at a premium to the broader market and to many staples peers, despite low-single-digit growth. The PEG of 1.01 suggests the multiple is fair relative to growth, but any deceleration could trigger a de-rating toward the low-20s PE seen historically (e.g., 21.96x in Q3 2021). The low beta of 0.482 provides downside protection in a market selloff, but it also means the stock may lag in a strong bull market, and defensive staples could underperform if investors rotate into cyclicals. Competitive threats from private-label and larger rivals in household products could pressure pricing and volumes.\n\nThe worst-case scenario involves a combination of organic volume decline, margin compression from input cost inflation, and multiple contraction. If revenue growth turns negative and the PE compresses to the low-20s (e.g., 22x), the stock could fall toward the analyst low target of $78, which is about 25% below the current price. The 52-week low of $81.33 represents a 22% decline from $104.53. A more severe outcome, such as a recession hitting discretionary household spending and a failed integration of Touchland, could push the stock below $78, but the low beta and defensive nature likely limit the downside to around -25% to -30% from current levels.
FAQ
The most severe risk is continued deceleration in organic growth, which at 1.57% in Q2 2026 is already weak and could turn negative if volume trends worsen. Margin pressure is another concern, as operating margin has been volatile (16.18% to 19.81% over recent quarters) and one-time charges can significantly impact earnings, as seen in Q4 2025's net margin collapse to 8.73%. Valuation compression is a risk given the premium multiple; a de-rating to the low-20s PE could push the stock toward $78–$85. Finally, integration risk from acquisitions like Touchland and Hero could distract management and dilute margins if not executed well.
Our 12-month forecast has a base case (55% probability) of $100–$108, assuming low-single-digit revenue growth and stable margins, with the stock trading near the analyst average target of $104.63. The bull case (25% probability) targets $110–$115, driven by organic acceleration above 3% and successful acquisition integration. The bear case (20% probability) targets $78–$85, reflecting negative organic growth and multiple compression toward the low-20s PE. The most likely scenario is the base case, as the company's defensive qualities and strong cash flow support the current valuation, but lack of growth limits upside.
CHD appears fairly valued to slightly overvalued. The trailing PE of 27.58x and forward PE of 25.92x are at a premium to the broader market and many staples peers, especially given revenue growth of only 1.57%. The PEG ratio of 1.01 suggests the multiple is in line with the growth rate, but the EV/EBITDA of 17.04x and price-to-sales of 3.28x are rich for a low-growth business. The stock's PE is near the middle of its historical range (21.96x to 39.42x), implying the market expects steady execution rather than significant re-rating. With the analyst average target at $104.63, the market is pricing in little upside.
CHD is a high-quality defensive staple with a low beta of 0.482, robust free cash flow of $1.115 billion, and a 1.41% dividend yield, making it suitable for risk-averse investors. However, at $104.53, the stock trades at 27.58x trailing earnings and 25.92x forward earnings, with an average analyst target of $104.63 implying essentially zero upside. Revenue growth of just 1.57% in Q2 2026 is a concern, and the PEG of 1.01 suggests the valuation is fair but not cheap. For long-term investors seeking stability, it could be a good buy on a pullback toward the $90–$95 range; for those seeking growth, better opportunities likely exist elsewhere.
CHD is best suited for long-term, income-oriented investors seeking low volatility and stable returns. Its beta of 0.482 and consistent free cash flow generation ($1.115 billion TTM) make it a defensive holding, but the low growth (1.57% revenue growth) and full valuation (27.58x PE) limit short-term upside. The stock's momentum is strong (up 26.49% YTD), but with the analyst target implying no upside, short-term trading is less attractive. A minimum holding period of 2-3 years is recommended to benefit from the dividend (1.41% yield) and potential multiple stability, while waiting for organic growth to reaccelerate.