08-28-2014, 01:04 PM
I too came up with a ttm P/E of 22 using GAAP reported earnings. Have no idea if there were any extraordinary items in there.
I think part of the slightly higher valuation over its peers (PG seeming to be the natural first pick as a rival) is because of a myriad reasons. 1.) CL, at first glance, was the faster grower of the last couple of decades. I would guess that there is more growth expected out of CL than PG in the near future also. 2.) I think they became better positioned than PG in emerging markets. 3.) Their dividend growth rate has been slightly higher than PG's according to longrundata. 4.) Fewer "stumbles" with products/pricing/acceptance than PG. There are probably many more reasons and it's as much perception as reality.
If I was going to pay those multiples, I'd be leaning more to CHD than CL, but their starting yield is even lower yet a very interesting growth story. Of course, higher growth can lead to a misstep that could cause the price to be more volatile.
I think part of the slightly higher valuation over its peers (PG seeming to be the natural first pick as a rival) is because of a myriad reasons. 1.) CL, at first glance, was the faster grower of the last couple of decades. I would guess that there is more growth expected out of CL than PG in the near future also. 2.) I think they became better positioned than PG in emerging markets. 3.) Their dividend growth rate has been slightly higher than PG's according to longrundata. 4.) Fewer "stumbles" with products/pricing/acceptance than PG. There are probably many more reasons and it's as much perception as reality.
If I was going to pay those multiples, I'd be leaning more to CHD than CL, but their starting yield is even lower yet a very interesting growth story. Of course, higher growth can lead to a misstep that could cause the price to be more volatile.