Updated 3/6/25
Church & Dwight Co., Inc. (CHD) might not be the most talked-about stock, but it has quietly built a strong track record of steady growth and reliable dividends. The company is best known for its well-established household brands like Arm & Hammer, OxiClean, and Trojan. These are products that people buy no matter what’s happening in the economy, which makes CHD a solid defensive play.
At around $110.89 per share, CHD is trading near its recent highs, reflecting investor confidence in its long-term prospects. While the stock isn’t a high-yield dividend payer, it does offer consistency, which is something long-term income investors appreciate. Let’s dive into what makes this stock a potential fit for dividend-focused portfolios.
Key Dividend Metrics
🟢 Dividend Yield: 1.06% – Modest but reliable income
🟢 Annual Dividend: $1.18 per share
🟢 Payout Ratio: 47.89% – Sustainable and allows for future increases
🟢 5-Year Average Dividend Yield: 1.14% – Consistency in returns
🟢 Dividend Growth Streak: Over 28 years – A commitment to shareholders
🟢 Ex-Dividend Date: February 14, 2025 – Important for investors looking to capture the next payout
Dividend Overview
Church & Dwight has built a reputation as a steady dividend payer, even if its current yield of 1.06% isn’t the highest on the market. The payout ratio of 47.89% suggests the company is being prudent, keeping enough earnings for reinvestment while still rewarding shareholders.
The real appeal here isn’t just the yield—it’s the company’s ability to grow dividends year after year. With over 28 years of consistent dividend increases, CHD has proven its commitment to delivering income growth for investors.
This kind of reliability is what makes consumer staples stocks attractive. Regardless of economic cycles, people still buy personal and household care products, giving the company stable revenue streams to support ongoing dividend payments.
Dividend Growth and Safety
When looking at dividend-paying stocks, growth potential is just as important as current yield. CHD has been consistent in raising its dividend over the years, which makes it a strong choice for investors looking to build long-term income.
With a payout ratio under 50%, there is still plenty of room for dividend increases. Free cash flow remains strong at $786.35 million, which adds further confidence in the company’s ability to maintain and grow dividends without stretching its financials.
Safety is another key factor. Given that Church & Dwight operates in a sector with relatively stable demand, its earnings remain predictable. That’s a huge plus for dividend investors who want to avoid volatility.
Chart Analysis
Price Action and Trend
The stock has been moving in a fairly volatile range over the past year, with noticeable peaks and pullbacks. Recently, it has climbed back toward the higher end of its range, closing at $110.89 after reaching an intraday high of $111.70. The price is now trading above both the 50-day moving average (orange line) and the 200-day moving average (blue line), which is typically a bullish sign indicating upward momentum.
There was a period of weakness in the latter part of the year when the price dipped below the 50-day moving average, but it regained strength, breaking back above that level and holding. Now, with the price sitting above both key moving averages, it suggests a potential continuation of the uptrend.
Volume Analysis
Volume on the latest trading session was 1.716 million, which is in line with recent averages. Looking at the broader volume trends, there were spikes in trading activity at certain points—especially in July and October—indicating strong buying and selling pressure at those times.
The volume bars show a mix of red and green days, meaning there were periods of heavier selling followed by recovery buying. A notable increase in green bars during recent weeks suggests that buyers have been stepping in to support the stock. If volume continues to increase as price rises, it could reinforce the strength of the trend.
Relative Strength Index (RSI)
The RSI indicator at the bottom of the chart shows that the stock has been climbing but hasn’t yet reached extreme overbought levels. It is currently hovering near the upper range, suggesting strong momentum, but not necessarily an immediate need for a pullback. If RSI moves above 70, it could indicate overbought conditions, leading to a potential short-term consolidation.
Moving Average Crossover
One of the more interesting signals on this chart is the relationship between the 50-day and 200-day moving averages. Earlier, the stock experienced a bearish crossover where the 50-day moved below the 200-day, but that trend has since reversed. The stock recently reclaimed both levels, signaling renewed strength. A clear bullish crossover of these moving averages would further support the case for sustained upside movement.
Recent Candlestick Behavior
The last five candlesticks show steady buying interest, with relatively small wicks on the downside. This suggests that sellers have been unable to push the price lower, and buyers are in control. The recent closes near the highs of the day also reflect positive sentiment. However, the price is approaching a prior resistance zone around $112.50, so it will be important to see whether it breaks through or struggles to push higher.
Analyst Ratings
🔼 Recent Upgrades
Several analysts have recently expressed a more optimistic outlook on Church & Dwight Co., Inc. Some firms have reaffirmed a positive stance, citing the company’s strong brand portfolio and consistent earnings growth as key factors. One reason for the optimism is the company’s ability to maintain stable profit margins despite rising input costs.
Another factor driving upgrades is the company’s steady cash flow and defensive market position, which make it a solid choice in uncertain economic conditions. Analysts highlighting these strengths have raised their price targets slightly, reflecting confidence in the stock’s ability to deliver continued shareholder value.
🔽 Recent Downgrades
On the other side, some analysts have taken a more cautious approach. A few firms have issued downgrades, pointing to concerns over valuation and competitive pressures. CHD has been trading at a premium relative to its sector, which some analysts believe limits upside potential in the near term.
Other concerns include rising costs and potential margin compression, particularly as private-label competitors gain traction. While the company has managed to navigate cost pressures effectively so far, some analysts worry that future price hikes might slow demand. As a result, a few firms have adjusted their price targets downward, reflecting a more neutral to cautious outlook.
🎯 Consensus Price Target
The average 12-month price target for CHD currently sits around $111.56, reflecting a balanced perspective. Some analysts see further upside if the company continues to execute well, while others remain cautious about valuation and market dynamics. The stock remains a steady performer, but its next move may depend on macroeconomic conditions and how well it manages costs and competition.
Earning Report Summary
Church & Dwight wrapped up 2024 on a strong note, delivering better-than-expected results in both the fourth quarter and full year. The company showed steady growth, thanks to continued demand for its well-known household and personal care brands.
Fourth Quarter Performance
In the last quarter of the year, sales came in at $1.51 billion, up 3.8% from the previous year. A lot of that growth came from strong consumer demand, particularly in the company’s core personal care and household product lines. Organic sales, which strip out the effects of acquisitions and currency fluctuations, rose 4.3%, with higher product volumes making up the bulk of that increase.
Domestically, sales climbed 3.3% to $1.17 billion, driven by strength in everyday essentials. The international segment was an even bigger bright spot, with sales jumping 9.5%, reflecting solid performance in both its local subsidiaries and broader global markets. Meanwhile, the Specialty Products Division had a bit of a mixed quarter—sales were down 8%, but organic sales actually rose 7.5%, showing that the company is focusing on more profitable areas within that segment.
Profitability improved as well, with gross margin expanding thanks to better cost management and pricing. While reported earnings per share showed a small loss due to some write-downs in the vitamin business, adjusted EPS came in at $0.79, up 6.8% from the prior year and ahead of expectations.
Full Year Highlights
For the entire year, Church & Dwight pulled in $6.1 billion in revenue, a 4.1% increase over 2023 and slightly above what the company had forecasted. Organic sales also grew by 4.6%, showing that the core business remains strong.
Gross margins saw a healthy bump, and adjusted EPS for the full year landed at $3.44, reflecting strong execution across the board. The company also generated over $1.15 billion in operating cash flow, a good sign that it’s managing its finances well and keeping cash moving in the right direction.
Looking Ahead
Church & Dwight expects growth to continue in 2025, though it’s planning to invest more in marketing during the first half of the year to support product launches. Most of the earnings growth is expected to come in the latter half of the year, as those investments start to pay off. Given its solid performance in 2024, the company seems well-positioned for another year of steady, reliable growth.
Financial Health and Stability
Church & Dwight has a solid financial foundation, though there are a few things worth keeping an eye on. The company holds $964.1 million in cash, which provides a cushion for short-term needs. On the other hand, total debt sits at $2.41 billion, resulting in a debt-to-equity ratio of 55.16%. While not excessive, it’s something to watch in a rising interest rate environment.
Profitability metrics paint a positive picture. The operating margin of 16.23% shows that the company maintains decent efficiency despite inflationary pressures. Return on equity stands at 14.25%, indicating the company generates reasonable profits for its shareholders.
Liquidity remains in good shape, with a current ratio of 1.70, meaning the company can comfortably cover its short-term obligations. Overall, Church & Dwight looks financially stable, though its debt load should be monitored as borrowing costs change over time.
Valuation and Stock Performance
One of the biggest factors investors consider before buying a stock is valuation, and this is where CHD is on the pricier side. With a forward P/E ratio of 30.03, the stock is trading at a premium relative to its earnings growth rate. A PEG ratio of 3.85 suggests that future growth expectations are already priced in, making it less of a bargain for value-focused investors.
Despite the high valuation, CHD has held up well in the market. It has been trading between $96.35 and $114.60 over the past year, currently hovering near the upper end of that range.
The stock’s stability is another major plus. With a beta of 0.56, CHD is less volatile than the broader market, making it a great choice for investors looking for a steady performer that won’t see extreme price swings.
Risks and Considerations
Every stock has risks, and CHD is no exception. Here are some potential challenges investors should be aware of.
Valuation Risk
With a P/E ratio above 30, the stock isn’t cheap. If earnings growth slows, there’s always a risk that the stock could see a pullback.
Interest Rate Sensitivity
With $2.41 billion in debt, rising interest rates could increase borrowing costs, which may impact profitability over time.
Modest Dividend Yield
For those who prioritize higher income, CHD’s 1.06% yield might not be appealing. Some alternatives in the consumer staples sector offer better yields, though they may not have the same level of dividend growth.
Competitive Pressures
Church & Dwight competes with industry giants like Procter & Gamble and Colgate-Palmolive. While its brands are strong, competition remains fierce, and cost pressures could affect margins.
Final Thoughts
Church & Dwight is the kind of stock that doesn’t get a lot of headlines but continues to deliver steady results. Its dividend yield may not be high, but the company has a long history of consistent growth and reliable payouts.
For investors looking for a defensive stock with a track record of increasing dividends, CHD is a solid option. The company operates in a stable industry, has a sustainable payout ratio, and maintains strong cash flow. While valuation remains a concern, long-term investors who prioritize dividend growth and low volatility may find CHD a great addition to a well-diversified income portfolio.
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