Church & Dwight Co., Inc. (CHD): A Bull Case Theory 

We came across a bullish thesis on Church & Dwight Co., Inc. on Value investing subreddit by kugelblitz_100. In this article, we will summarize the bulls’ thesis on CHD. Church & Dwight Co., Inc.’s share was trading at $91.48 as of January 28th. CHD’s trailing and forward P/E were 28.86 and 24.27 respectively according to Yahoo Finance.

Church & Dwight Co., Inc. (CHD) has experienced significant weakness, with its stock down over 20% year-to-date and falling another 3.4% recently. While the past five years have been challenging for shareholders, much of the underperformance can be attributed to the company’s previously elevated valuation during the pandemic years. Despite the stock decline, CHD continues to generate strong free cash flow and maintain mid-single-digit revenue growth, underscoring the resilience of its underlying business.

The company’s current P/E ratio has reverted to its long-term historical average, suggesting that the market is now pricing it more reasonably compared to prior periods of exuberance. Compared to larger peers such as Clorox and Procter & Gamble, CHD’s relatively smaller size provides it with greater operational flexibility, potentially enabling it to adapt more quickly to market opportunities and grow at a faster pace.

This combination of robust cash generation, steady revenue growth, and nimble scale positions CHD as an attractive entry point for investors seeking both stability and upside potential, particularly after a prolonged period of market mispricing. Given these factors, the current share price may present a compelling opportunity for long-term investors to capture value in a company with a proven track record and solid fundamentals. Overall, CHD’s stock appears poised to benefit from a more normalized valuation environment while continuing to leverage its agility and strong cash flows to deliver shareholder value.

Previously we covered a bullish thesis on Colgate-Palmolive Company (CL) by Kontra in October 2024, which highlighted its leadership in oral, personal, home care, and pet nutrition products, strong emerging market presence, and high ROIC. The stock has depreciated approximately by 15.38% since our coverage. The thesis still stands as CL remains a quality compounder. kugelblitz_100 shares a similar perspective but emphasizes CHD’s market mispricing, strong free cash flow, and nimbleness for long-term investors.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW 

Disclosure: None.