CHD Will Need To Invest Its Cash In Hand To Drive Shares Higher
Analysts at SunTrust Robinson Humphrey maintain their "buy" rating on Church & Dwight Co (NYSE: CHD). The 12-month target price for CHD has been raised from $70 to $75.
According to SunTrust Robinson Humphrey, Church & Dwight Co has been forced to introduce trade promotions to compete with the high level of trade promotions introduced by Procter & Gamble (NYSE: PG). “Despite the adverse promotional environment, we believe CHD is well positioned to have another strong year. In 1Q the company will benefit from several new products launches, cost savings from its new plant, and increased distribution at several channels,” the analysts say.
“The stock is already up 12% YTD and we believe that it will need to put its ~$450 million in cash on hand to use to move it materially higher in the near term. That said, CHD remains engaged in a number of M&A discussions and the consumer M&A environment has clearly heated up over the past six months,” SunTrust's Robinson Humphrey adds.
