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On Tuesday, Jefferies analyst Kaumil Gajrawala adjusted the price target for Church & Dwight Co. Inc. (NYSE:CHD) to $106.00 from the previous $100.00, while the Hold rating on the stock remains unchanged. The revision follows Church & Dwight’s acquisition of the sanitizer brand Touchland for $700 million, a deal comprising both cash and restricted stock.
Gajrawala noted that the acquisition is a positive step for Church & Dwight, as it continues to target premium and younger demographics. The company has previously seen success with brands like Hero and Therabreath, which aligns with its current strategy. The Touchland deal is expected to provide more clarity on the company’s financial projections, especially during a period when many businesses are facing economic challenges that lead to downward revisions in their forecasts.
Church & Dwight’s strategy has been to expand its portfolio with brands that resonate with a younger consumer base, and the acquisition of Touchland is a testament to this approach. The deal is significant as it not only adds a popular product to Church & Dwight’s lineup but also comes at a time when hygiene products have seen increased demand due to health and safety concerns.
The analyst’s commentary underscores the strategic fit of the acquisition for Church & Dwight, highlighting the company’s adeptness at integrating new brands and bolstering its market position. The acquisition is also timely, as it offers an opportunity for Church & Dwight to strengthen its financial outlook amidst uncertain economic conditions.
Church & Dwight’s stock price will continue to be monitored by investors and market analysts as the company integrates Touchland into its operations and as it navigates the broader market headwinds mentioned by Gajrawala. The updated price target suggests that Jefferies sees potential for Church & Dwight’s stock value to grow, although the firm currently advises a neutral stance with the Hold rating.
In other recent news, Church & Dwight has announced a significant acquisition, agreeing to purchase the hand sanitizer brand Touchland for up to $880 million. The deal includes an initial payment of $700 million and a potential additional $180 million based on Touchland’s future net sales. This acquisition aligns with Church & Dwight’s strategy of acquiring asset-light brands with growing margins, and it is expected to be neutral to the company’s 2025 earnings per share. On the earnings front, Church & Dwight reported its first-quarter 2025 results, with earnings per share slightly surpassing expectations at $0.91, but revenue falling short at $1.47 billion compared to the anticipated $1.51 billion. Analysts have reacted to these developments, with TD Cowen downgrading the stock from Buy to Hold and lowering the price target to $100, citing reduced growth expectations. UBS also adjusted its price target to $102, maintaining a Neutral rating, while Jefferies cut its target to $100, emphasizing the challenging outlook for 2025. These analyst actions reflect concerns over Church & Dwight’s slower growth and tariff impacts, despite the company’s efforts to enhance productivity and expand internationally.
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