Analyzing Colgate-Palmolive (NYSE:CL) & Newell Brands (NASDAQ:NWL)

Colgate-Palmolive (NYSE:CL) and Newell Brands (NASDAQ:NWL) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Risk & Volatility

Colgate-Palmolive has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500. Comparatively, Newell Brands has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Colgate-Palmolive and Newell Brands, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Colgate-Palmolive	0	7	12	0	2.63
Newell Brands	2	5	3	0	2.10

Colgate-Palmolive presently has a consensus price target of $95.88, suggesting a potential upside of 5.84%. Newell Brands has a consensus price target of $4.94, suggesting a potential upside of 3.87%. Given Colgate-Palmolive’s stronger consensus rating and higher probable upside, analysts plainly believe Colgate-Palmolive is more favorable than Newell Brands.

Dividends

Colgate-Palmolive pays an annual dividend of $2.12 per share and has a dividend yield of 2.3%. Newell Brands pays an annual dividend of $0.28 per share and has a dividend yield of 5.9%. Colgate-Palmolive pays out 82.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Newell Brands pays out -41.8% of its earnings in the form of a dividend. Colgate-Palmolive has increased its dividend for 63 consecutive years. Newell Brands is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares Colgate-Palmolive and Newell Brands”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Colgate-Palmolive	$20.38 billion	3.56	$2.13 billion	$2.57	35.25
Newell Brands	$7.20 billion	0.28	-$285.00 million	($0.67)	-7.10

Colgate-Palmolive has higher revenue and earnings than Newell Brands. Newell Brands is trading at a lower price-to-earnings ratio than Colgate-Palmolive, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

80.4% of Colgate-Palmolive shares are owned by institutional investors. Comparatively, 92.5% of Newell Brands shares are owned by institutional investors. 0.4% of Colgate-Palmolive shares are owned by company insiders. Comparatively, 1.6% of Newell Brands shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Colgate-Palmolive and Newell Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Colgate-Palmolive	10.04%	386.76%	17.89%
Newell Brands	-3.91%	8.89%	2.03%

Summary

Colgate-Palmolive beats Newell Brands on 12 of the 17 factors compared between the two stocks.

About Colgate-Palmolive

Colgate-Palmolive Company, together with its subsidiaries, manufactures and sells consumer products in the United States and internationally. It operates through two segments: Oral, Personal and Home Care; and Pet Nutrition. The Oral, Personal and Home Care segment offers toothpaste, toothbrushes, mouthwash, bar and liquid hand soaps, shower gels, shampoos, conditioners, deodorants and antiperspirants, skin health products, dishwashing detergents, fabric conditioners, household cleaners, and other related items. This segment markets and sells its products under various brands, which include Colgate, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, Irish Spring, Palmolive, Protex, Sanex, Softsoap, Lady Speed Stick, Speed Stick, EltaMD, Filorga, PCA SKIN, Ajax, Axion, Fabuloso, Murphy, Suavitel, and Soupline to a range of traditional and eCommerce retailers, wholesalers, and distributors. It includes pharmaceutical products for dentists and other oral health professionals. Its Pet Nutrition segment offers pet nutrition products for everyday nutritional needs under the Hill's Science Diet brand; and a range of therapeutic pet products to help nutritionally support dogs and cats in different stages of health under the Hill's Prescription Diet brand. This segment markets and sells its products through pet supply retailers, veterinarians, and eCommerce retailers. Colgate-Palmolive Company was founded in 1806 and is headquartered in New York, New York.

About Newell Brands

Newell Brands Inc. engages in the design, manufacture, sourcing, and distribution of consumer and commercial products worldwide. The company operates in three segments: Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The Commercial Solutions segment provides commercial cleaning and maintenance solution products under the Rubbermaid, Rubbermaid Commercial Products, Mapa, and Spontex brands; closet and garage organization products; hygiene systems and material handling solutions; household products, such as kitchen appliances under the Crockpot, Mr. Coffee, Oster, and Sunbeam brands; small appliances under the Breville brand name in Europe; food and home storage products under the FoodSaver, Rubbermaid, Ball, and Sistema brands; fresh preserving products; vacuum sealing products; and gourmet cookware, bakeware, and cutlery under the Calphalon brand; and home fragrance products under the WoodWick and Yankee Candle brands. The Learning and Development segment offers writing instruments, including markers and highlighters, pens, and pencils; art products; activity-based products; labeling solutions; and baby gear and infant care products under the Dymo, Elmer's, EXPO, Graco, NUK, Paper Mate, Parker, and Sharpie brands. The Outdoor and Recreation segment provides outdoor and outdoor-related products, inlcuding technical apparel and on-the-go beverageware under the Campingaz, Coleman, Contigo, and Marmot brands. It serves warehouse clubs, department and drug/grocery stores, mass merchants, home centers, commercial products distributors, specialty retailers, office superstores and supply stores, contract stationers, e-commerce retailers, and sporting goods, as well as direct to consumers online, select contract customers, and other professional customers. Newell Brands Inc. was founded in 1903 and is based in Atlanta, Georgia.