Overview
Morgan Stanley has raised its price objective on Colgate-Palmolive Company to $100.00 from $87.00 and left its rating at Overweight. The updated target brings the analyst valuation close to the high target of $105 and comes as the stock trades around $90.29. Technical indicators suggest the share price is in overbought territory based on relative strength measures.
Fourth-quarter performance and revenue drivers
The firm highlighted Colgate’s fourth-quarter organic sales increase of 3.1% when excluding discontinued pet products as a reasonably healthy outcome in the current operating backdrop. That uptick was led by mid-single-digit organic growth in emerging markets, which account for roughly 45% of the company’s sales mix. By contrast, Colgate’s overall revenue growth measured 1.4% over the last twelve months.
Margins and cost dynamics
Morgan Stanley noted sequential margin improvement in the fourth quarter. Gross margin deterioration year-over-year narrowed to approximately 10 basis points in the quarter, improving markedly from a 180 basis point decline in the prior quarter. The firm attributed this to moderating pressure from raw materials and foreign exchange. Colgate’s gross profit margin stands at 60.11%, a metric the analyst flagged as a positive element of the company’s financial profile.
Guidance and analyst expectations
Colgate issued initial fiscal year 2026 guidance calling for 1% to 4% organic sales growth and low-single-digit to mid-single-digit earnings per share growth. Morgan Stanley described the guidance as deliberately wide and conservative, reflecting both the firm’s recognition of strong trends in emerging markets and the remaining uncertainty around promotional activity, foreign exchange swings, geopolitical factors, and continued softness in the U.S. market. Street consensus for fiscal 2026 EPS sits at $3.82.
Regional performance and shareholder returns
Within Colgate’s profit mix, North America remains a relative weakness but contributes only about 16% of profit. Year-to-date the stock has appreciated roughly 15% and has shown solid positive returns over the last month and three months. For income-focused investors, Colgate has increased its dividend for 36 consecutive years and has maintained dividend distributions for 56 consecutive years.
Earnings beat and peer analyst moves
In its recently reported fourth-quarter 2025 results, Colgate delivered adjusted earnings per share of $0.95, ahead of the $0.91 estimate, and posted revenue of $5.23 billion versus a $5.12 billion projection. That quarterly outperformance has supported bullish reassessments across other brokerages. Evercore ISI raised its price target to $100 and kept an Outperform rating, citing growth momentum and market share gains in oral care and the Hill’s pet nutrition franchise. Wells Fargo lifted its target to $94 based on a revised 2027 earnings multiple, and TD Cowen raised its target to $96 after the slight fourth-quarter earnings beat and constructive 2026 guidance.
Implications for investors
Morgan Stanley’s move to increase its price target reflects a confluence of improving margin trends, resilient emerging-market volumes and an underlying EPS outlook that the firm judges to be conservative. The combination of a near-term earnings beat and multiple analyst target increases suggests a broadening sense among sell-side firms that Colgate’s trajectory is improving, even as specific regional and macro uncertainties remain.
Note: This article presents reported figures and analyst actions; it does not introduce additional forecasts beyond those provided by the firm and other cited brokerages.