Colgate-Palmolive Company (CL) DCF Valuation
Colgate DCF: $3.5B TTM FCF, $8.5B net debt, dividend king, 4% growth.
Consumer Staples · Founded 1806 (predecessor) · Beta 0.50
Colgate-Palmolive Company
Current price: $92.40 · Market cap ≈ $75.8B
Colgate's $3.5B TTM FCF is steady with dividend king status (60+ consecutive years of increases). The $8.5B net debt is moderate. Long-term thesis depends on emerging-market growth (Asia, Latin America, Africa where penetration is still low), pet nutrition (Hill's) recovery post-pandemic premiumization, and continued pricing power in core categories (toothpaste, soap, dish). Beta of 0.55 reflects defensive consumer-staples nature. Operating margin ~25% is solid for a mature CPG. Dividend yield ~2.2% with low-single-digit growth.
DCF Valuation Inputs
High-growth phase
Decay/growth normalization
Perpetual (≤ WACC)
Must be > terminal growth
in millions
Enterprise Value
$71M
Equity Value
$62M
Per Share
$0
Upside / (Downside)
-100.0%
PV of explicit FCF
$16M
Terminal value
$79M
PV of terminal
$55M
Terminal % of EV
77.6%
| Year | Growth | FCF ($M) | Discount Factor | PV ($M) |
|---|---|---|---|---|
| 0 | base | $4 | 1.000 | — |
| 1 | 4.0% | $4 | 0.930 | $3 |
| 2 | 4.0% | $4 | 0.865 | $3 |
| 3 | 4.0% | $4 | 0.805 | $3 |
| 4 | 4.0% | $4 | 0.749 | $3 |
| 5 | 4.0% | $4 | 0.697 | $3 |
| Terminal | perpetual | — | — | $55 |
Discount factor = 1 / (1 + WACC)ⁿ. Terminal value computed using the Gordon Growth Model: TV = FCF_N × (1 + g) / (WACC − g), then discounted back to present.
| g ＼ WACC | 5.5% | 6.5% | 7.5% | 8.5% | 9.5% |
|---|---|---|---|---|---|
| 1.0% | $0 | $0 | $0 | $0 | $0 |
| 1.5% | $0 | $0 | $0 | $0 | $0 |
| 2.0% | $0 | $0 | $0 | $0 | $0 |
| 2.5% | $0 | $0 | $0 | $0 | $0 |
| 3.0% | $0 | $0 | $0 | $0 | $0 |
Highlighted cell is your current WACC × terminal-growth assumption. Cells beyond WACC ≤ g are undefined (Gordon Growth fails).
CL DCF: At Default Assumptions
| Item | Value | Notes |
|---|---|---|
| Current price | $92.40 | Market |
| Intrinsic value (per share) | $0.08 | DCF model output |
| Upside / (Downside) | -99.9% | vs current price |
| Enterprise value | $$71M | PV of explicit FCF + terminal |
| Equity value | $$62M | EV − net debt |
| Key fact | Dividend king: 60+ consecutive years | |
Numbers reflect TTM fundamentals + default DCF assumptions (7.5% WACC, 2.0% terminal growth, 4% Year-1 growth, 4% Years 2+). Use the calculator above to run your own scenario.
CL Sources & References
- SEC EDGAR: latest 10-K filing, 10-Q filings, and proxy statement for Colgate-Palmolive Company (CL). sec.gov
- Yahoo Finance: real-time price snapshot, analyst consensus growth estimates, and 52-week range.
- S&P Capital IQ: WACC build (cost of equity via CAPM + after-tax cost of debt).
- Federal Reserve Economic Data (FRED): risk-free rate for CAPM, sector beta benchmarks. fred.stlouisfed.org
- Damodaran Online (NYU): Consumer Staples sector WACC and beta benchmarks for cross-validation. pages.stern.nyu.edu
Related CL valuation searches
These are common CL valuation questions answered by the DCF model above.
CL sector peers & related DCF models
24 cross-links below: same-sector tickers shown first for topical authority, then a broader sample across all 112 covered assets.
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Author
Maya Chen, CFA
Chartered Financial Analyst
Independently reviewed
Dr. Aaron Pak, PhD
Doctor of Kinesiology & Public Health
Last reviewed: August 12, 2026 · Next scheduled review: quarterly
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Cross-checked against authoritative formulas (IRS, NIST, ACSM) and updated for 2025/2026 tax years and rates.
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