Will Promotion Costs Hurt Church & Dwight Q3 Earnings?

Church & Dwight Co., Inc. CHD) is slated to release third-quarter 2017 results on Nov 2. The question lingering in investors' minds is, whether this leading manufacturer and marketer of personal care, household and specialty products will be able to post a positive earnings surprise again in the to-be-reported quarter. The company has been delivering positive earnings surprise for three straight quarters now. Let's see how things are shaping up prior to this announcement.

Church & Dwight Company, Inc. Price and EPS Surprise
 

Church & Dwight Company, Inc. Price and EPS Surprise | Church & Dwight Company, Inc. Quote

What to Expect?

The current Zacks Consensus Estimate for the quarter under review is pegged at 47 cents, which is in line with the year-ago period figure. Further, the earnings estimate has trended upward in the last 30 days. Also, analysts polled by Zacks expect revenues of $937 million, up roughly 7.6% from the year-ago quarter.

Factors at Play

A look at Church & Dwight's past performance reveals that out of the past 13 quarters, the company's bottom line has outpaced the Zacks Consensus Estimate in 10 quarters, while the top line has surpassed the same 11 times. The impressive past performance can be attributed to Church & Dwight's solid brand portfolio, along with focus on acquisitions and innovations. Evidently, in the last quarter, sales grew 2.3% on the back of acquisitions. Organic sales climbed 1.8% as higher volumes were largely offset by higher promotional investments, which continues to be a hurdle. While shares of the company have gained 3.8% so far this year, it has underperformed the industry's jump of 16.3%.

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