A Consumer Products Company Worth Putting On Your Watch list
Church & Dwight Company, Inc CHD was founded in 1846. The Company develops, manufactures and markets a broad range of household, personal care and specialty products. The Company focuses its marketing efforts mainly on its eight power brands.' These well-recognized brand names include ARM & HAMMER, (used in multiple product categories such as baking soda, carpet deodorization and laundry detergent), TROJAN Condoms, XTRA laundry detergent, OXICLEAN pre-wash laundry additive, NAIR depilatories, FIRST RESPONSE home pregnancy and ovulation test kits, ORAJEL oral analgesics and SPINBRUSH battery-operated toothbrushes. The Company's business is divided into three primary segments, Consumer Domestic, Consumer International and Specialty Products. The Consumer Domestic segment includes the eight power brands and other household and personal care products such as SCRUB FREE, KABOOM, ORANGE GLO and BRILLO cleaning products, ANSWER home pregnancy and ovulation test kits, ARRID antiperspirant, CLOSE-UP and AIM toothpastes. The Consumer International segment mainly sells a variety of personal care products, some of which use the same brands as its domestic product lines, in international markets, including France, the United Kingdom, Canada, Mexico, Australia, Brazil and China. The Specialty Products segment is the largest U.S. producer of sodium bicarbonate, which it sells together with other specialty inorganic chemicals for a variety of industrial, institutional, medical and food applications. This segment also sells a range of animal nutrition and specialty cleaning products. The Company's operations are subject to federal, state and local regulations governing air emissions, wastewater discharges, and solid and hazardous waste management activities. Church and Dwight have many characteristics one would like in an investment and not just a dividend growth investment. In this article I will show you why this company is worth a look and may even be worth buying today. Among the reasons you should either buy or place this company on your watch list are:
History of Returning Capital to Shareholders
Below is Church and Dwight’s history of dividend growth dating back the last ten years showing a steady level of returning capital to shareholders including steady dividend increases .
Nov 10, 2010 | $0.17000 |
Aug 12, 2010 | $0.17000 |
May 13, 2010 | $0.14000 |
May 13, 2010 | $0.14000 |
Feb 8, 2010 | $0.14000 |
Nov 5, 2009 | $0.14000 |
Aug 11, 2009 | $0.14000 |
May 7, 2009 | $0.09000 |
Feb 5, 2009 | $0.09000 |
Nov 6, 2008 | $0.09000 |
Aug 7, 2008 | $0.09000 |
May 8, 2008 | $0.08000 |
Feb 7, 2008 | $0.08000 |
Nov 7, 2007 | $0.08000 |
Aug 9, 2007 | $0.08000 |
May 10, 2007 | $0.07000 |
Feb 5, 2007 | $0.07000 |
Nov 9, 2006 | $0.07000 |
Aug 10, 2006 | $0.07000 |
May 11, 2006 | $0.06000 |
Feb 2, 2006 | $0.06000 |
Nov 9, 2005 | $0.06000 |
Aug 11, 2005 | $0.06000 |
May 12, 2005 | $0.06000 |
Feb 3, 2005 | $0.06000 |
Nov 10, 2004 | $0.06000 |
Aug 12, 2004 | $0.06000 |
May 13, 2004 | $0.05333 |
Feb 4, 2004 | $0.05333 |
Nov 5, 2003 | $0.05333 |
Aug 6, 2003 | $0.05333 |
May 7, 2003 | $0.05000 |
Feb 5, 2003 | $0.05000 |
Nov 6, 2002 | $0.05000 |
Aug 7, 2002 | $0.05000 |
May 8, 2002 | $0.05000 |
Feb 6, 2002 | $0.05000 |
Aug 8, 2001 | $0.05000 |
May 9, 2001 | $0.04667 |
Feb 6, 2001 | $0.04667 |
Nov 8, 2000 | $0.04667 |
Aug 9, 2000 | $0.04667 |
May 10, 2000 | $0.04667 |
|
Feb 8, 2000
|
$0.04667
|
Strong Quality of Management
Return on Equity | 15.10% |
Return on Assets | 7.40% |
|
Both numbers are positive and Return on Equity is quite strong at above 10%. |
Strong Growth and the Added Safety of a Brand Portfolio
15 to 20% has been the level of 5 and 10 year growth and earnings are still expected to continue growing at around 11%.
Dividend growth over the last ten years has been around 14%.
Foward dividend growth will likely be in the 10% range.
On top of solid growth the company has several strong brands in its portfolio the most loved of which are Trojan brand condoms and related products and its Arm and Hammer baking soda and related consumer goods.
Risks
Risks include:
Failure to reach growth targets
Acquisition risks
Loss of pricing power
Negative earnings surprise
Conclusion: A collection of strong brands, solid dividend growth and a great management team make Church and Dwight worth watching and possibly even buying today.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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