Falling revenue did not prevent S&P 500 (NYSE:SPY) component Colgate-Palmolive Co. (NYSE:CL) from reporting a profit boost in the third quarter. Colgate Palmolive manufactures and markets a number of oral, personal, home care, and pet nutrition products for customers around the world.
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Colgate-Palmolive Co. Earnings Cheat Sheet
Results: Net income for Colgate-Palmolive Co. rose to $654 million ($1.36 per share) vs. $643 million ($1.31 per share) in the same quarter a year earlier. This marks a rise of 1.7% from the year-earlier quarter.
Revenue: Fell 1.2% to $4.33 billion from the year-earlier quarter.
Actual vs. Wall St. Expectations: Colgate-Palmolive Co. reported adjusted net income of $1.38 per share. By that measure, the company fell in line with the mean estimate of $1.38 per share. Analysts were expecting revenue of $4.27 billion.
Quoting Management: Ian Cook, Chairman, President and Chief Executive Officer, commented on the results and outlook excluding the 2012 and 2011 items noted above and the costs of the Global Growth and Efficiency Program discussed below, “We are very pleased to have achieved another quarter of strong profitability with gross profit margin, operating profit margin and net income as a percent to sales all increasing versus year ago, despite an intense competitive environment and challenging macroeconomic conditions worldwide.”
The company has now seen its net income increase for three consecutive quarters. In the second quarter, net income rose 0.8% and in the first quarter, the figure rose 3%.
A year-over-year revenue decrease last quarter breaks a four-quarter streak of revenue increases. The best quarter in that span was the third quarter of the last fiscal year, which saw revenue rise 11.2%.
The company has now fallen in line with estimates for the past two quarters. It reported net income of $1.33 in the second quarter and net income of $1.24 in the first quarter.
The company’s cost of sales fell 6.1% from a year earlier to $1.8 billion. Last quarter, cost of sales was 41.6% of revenue versus 43.8% a year earlier.
Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the fourth quarter has moved up from $1.38 a share to $1.40 over the last sixty days. For the fiscal year, the average estimate has moved up from $5.34 a share to $5.36 over the last thirty days.
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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
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