Investing.com -- Bank of America upgraded Church & Dwight (NYSE:CHD) to "Buy" given company’s defensive positioning and consistent performance during economic downturns. Meanwhie, brokerage double downgraded Coty Inc (NYSE:COTY) to "Underperform" from "Buy" flagging slowing momentum across both Prestige and Consumer Beauty segments.
Church & Dwight’s price objective was bumped to $125 from $112. The company’s value-oriented portfolio and strong U.S. focus make it well-placed to outperform in a recessionary backdrop, analysts said.
“Our rating change is based on our view that CHD is poised to benefit from a challenging consumer backdrop and potential trade-down with its value portfolio,” BofA wrote, noting the stock beat the S&P 500 by an average of 22% in the last four recessions.
The bank cited improving volume trends, market share gains, and limited private label exposure as key drivers.
It expects no further pricing upside but sees minimal risk to margins as consumers shift toward value offerings. BofA now values CHD at a 30x 2026 estimated EPS, above its 10-year average of 27x, pointing to strong fundamentals and M&A potential as reasons for the premium.
Coty’s target was halved by BofA analysts, slashed it to $4.50 from $9.
Strength in Prestige fragrance was waning amid global share losses and weaker consumer demand, analysts said, adding that market share in mass beauty remains under pressure.
The firm also raised concerns over Coty’s short-duration licenses, including Gucci, which it estimates generates over $500 million in annual sales.
BofA cut its valuation multiples for both business units, now applying a 4.5x 2026e EBITDA multiple to the total business, down from 7x previously, reflecting what it sees as increasing structural and macroeconomic headwinds.