Contrasting Colgate-Palmolive (NYSE:CL) and Nestle (OTCMKTS:NSRGY)

Colgate-Palmolive (NYSE:CL) and Nestle (OTCMKTS:NSRGY) are both large-cap consumer staples companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, risk, valuation, institutional ownership, earnings and profitability.

Risk & Volatility

Colgate-Palmolive has a beta of 0.34, suggesting that its share price is 66% less volatile than the S&P 500. Comparatively, Nestle has a beta of 0.51, suggesting that its share price is 49% less volatile than the S&P 500.

Profitability

This table compares Colgate-Palmolive and Nestle’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Colgate-Palmolive	10.45%	353.72%	17.63%
Nestle	N/A	N/A	N/A

Valuation & Earnings

This table compares Colgate-Palmolive and Nestle”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Colgate-Palmolive	$20.38 billion	3.36	$2.13 billion	$2.62	32.56
Nestle	$107.99 billion	2.38	$10.90 billion	N/A	N/A

Nestle has higher revenue and earnings than Colgate-Palmolive.

Insider & Institutional Ownership

80.4% of Colgate-Palmolive shares are owned by institutional investors. Comparatively, 0.6% of Nestle shares are owned by institutional investors. 0.3% of Colgate-Palmolive shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Colgate-Palmolive pays an annual dividend of $2.08 per share and has a dividend yield of 2.4%. Nestle pays an annual dividend of $2.55 per share and has a dividend yield of 2.6%. Colgate-Palmolive pays out 79.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Colgate-Palmolive has raised its dividend for 63 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings for Colgate-Palmolive and Nestle, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Colgate-Palmolive	0	6	11	0	2.65
Nestle	1	2	1	0	2.00

Colgate-Palmolive currently has a consensus price target of $95.25, suggesting a potential upside of 11.64%. Given Colgate-Palmolive’s stronger consensus rating and higher probable upside, research analysts plainly believe Colgate-Palmolive is more favorable than Nestle.

Summary

Colgate-Palmolive beats Nestle on 10 of the 15 factors compared between the two stocks.

About Colgate-Palmolive

Colgate-Palmolive Company, together with its subsidiaries, manufactures and sells consumer products in the United States and internationally. It operates through two segments: Oral, Personal and Home Care; and Pet Nutrition. The Oral, Personal and Home Care segment offers toothpaste, toothbrushes, mouthwash, bar and liquid hand soaps, shower gels, shampoos, conditioners, deodorants and antiperspirants, skin health products, dishwashing detergents, fabric conditioners, household cleaners, and other related items. This segment markets and sells its products under various brands, which include Colgate, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, Irish Spring, Palmolive, Protex, Sanex, Softsoap, Lady Speed Stick, Speed Stick, EltaMD, Filorga, PCA SKIN, Ajax, Axion, Fabuloso, Murphy, Suavitel, and Soupline to a range of traditional and eCommerce retailers, wholesalers, and distributors. It includes pharmaceutical products for dentists and other oral health professionals. Its Pet Nutrition segment offers pet nutrition products for everyday nutritional needs under the Hill's Science Diet brand; and a range of therapeutic pet products to help nutritionally support dogs and cats in different stages of health under the Hill's Prescription Diet brand. This segment markets and sells its products through pet supply retailers, veterinarians, and eCommerce retailers. Colgate-Palmolive Company was founded in 1806 and is headquartered in New York, New York.

About Nestle

Nestlé S.A., together with its subsidiaries, operates as a food and beverage company. The company operates through Zone North America; Zone Europe; Zone Asia, Oceania, and Africa; Zone Latin America; Zone Greater China; Nespresso; and Nestlé Health Science segments. It offers baby foods under the Cerelac, Gerber, Nido, and NaturNes brands; bottled water under the Nestlé Pure Life, Perrier, Vittel, Buxton, Erikli, and S.Pellegrino brands; cereals under the Fitness, Nesquik, cheerios, and Lion Cereals brands; and chocolate and confectionery products under the KitKat, Smarties, Aero, Nestlé Les Recettes de l'Atelier, Milkybar, Baci Perugina, Quality Street, and Fitness brands. The company provides coffee products under the Nescafé, Nespresso, Nescafé Dolce Gusto, Starbucks Coffee At Home, and Blue Bottle Coffee brands; culinary, chilled, and frozen foods under the Maggi, DiGiorno, Thomy, Garden Gourmet, Sweet Earth, Hot Pockets, Stouffer's, Buitoni, Lean, and Life Cuisine brands; dairy products under the Carnation, Nido, Bear, Coffee-Mate, and La Laitière brands; and drinks under the Nesquik, Nestea, Nescafé, and Milo brands. In addition, it offers food service products under the Milo, Nescafé, Maggi, Chef, Nestea, Stouffer's, Chef-Mate, Minor's, and Lean Cuisine brand names; healthcare nutrition products under the Boost, Garden of Life, Nature's Bounty, Persona, Vital Proteins, Solgar, Peptamen, Resource, Vitaflo, Impact, and Compleat brands; ice cream products under the Movenpick, Häagen-Dazs, Nestlé Ice Cream, and Extrême brands; and pet care products under the Purina, ONE, Alpo, Felix, Pro Plan, Cat Chow, Fancy Feast, Bakers, Friskies, Dog Chow, Beneful, and Gourmet brands. The company was founded in 1866 and is headquartered in Vevey, Switzerland.