TD Cowen Cuts Colgate-Palmolive Target to $85 Citing 40% Input Cost Hike
TD Cowen cut Colgate-Palmolive to Hold with a price target trimmed to $85 from $96, citing oil-based input costs and tallow prices up 40% that will limit 2026 EPS growth to 4%. Fed’s Schmid warned inflation could reach 3% as energy price spikes fuel broader cost pressures.
1. Analyst Downgrade on Input Costs
TD Cowen downgraded Colgate-Palmolive to Hold from Buy and trimmed its price target to $85 from $96, valuing the stock at a 21x multiple on an FY27 EPS estimate of $4.02. The firm cited heightened inflationary pressure from oil-based inputs and tallow prices up 40%, cutting its EPS growth forecasts to 4% for 2026 and 4.5% for 2027.
2. Inflation Warning from Energy Shock
Federal Reserve Bank of Kansas City President Jeff Schmid warned that energy price surges tied to the Iran conflict risk driving inflation closer to 3%. He noted that higher oil and gas costs will feed into core inflation via airfares and transportation, complicating the Fed’s efforts to balance its dual mandate and potentially sustaining cost pressures for consumer goods.