Colgate-Palmolive Co CL

We see little in wide-moat Colgate’s second quarter to warrant altering our $72 fair value estimate or long-term forecast (3%-4% sales growth each year and 200 basis points of operating margin expansion over fiscal 2020 to the mid-20s by the end of our 10-year forecast), even after incorporating time value and Morningstar’s forecast for an increase in the U.S. corporate tax rate from 2022 onward, which largely offset. And despite a mid-single-digit pullback in the shares on the print, we don’t think investors should add the stock to their shopping carts, given it trades at more than a 10% premium to our intrinsic valuation.