Key Takeaways
- Haleon shares fell 14% today after it cut its 2026 organic revenue growth outlook to around 2.5%, from 3%-5%.
- A further £500 million buyback, easily covered by free cash flow, couldn’t make up for slowing sales.
- Procter & Gamble’s health care sales grew about as fast as Haleon’s, and Colgate-Palmolive and Church & Dwight report tomorrow.
- Haleon needs to get back to its 4%-6% medium-term growth goal before the stock earns back its old valuation.
Haleon (HLN) shares sank 14% today after the Sensodyne maker cut its growth outlook for the year. A fresh £500 million buyback didn’t help.
That matters for Procter & Gamble (PG), Colgate-Palmolive (CL) and Church & Dwight (CHD), which fight Haleon for the same toothpaste and drugstore shelves.
A quarter below plan
CEO Brian McNamara put it plainly: “Q3 was below our expectations.” Here’s what the quarter looked like:
- Organic revenue growth: 2.6%, down from 3.1% in the second quarter
- Oral Health: up 8.8%
- 2026 organic revenue growth: now around 2.5%, cut from 3%-5%
A soft cold and flu season cut North American orders. Rival pain relief launches and a new sales model in Brazil weigh on the fourth quarter.
The buyback was the easy part
Its free cash flow has risen every year since 2021:
The £500 million is about a fifth of last year’s £2.3 billion.
But growth is what slipped. Management kept its 4%-6% medium-term goal, and Wall Street’s revenue estimates, set before today, already had Haleon near the bottom of it:
That’s about 4% a year in 2027 and 2028, and I’d expect those estimates to come down after today.
Soft shelves, plus problems of its own
P&G’s health care sales grew 3% organically in the quarter to September, about Haleon’s pace. So weak demand isn’t Haleon’s alone.
Colgate’s North American organic sales fell 3% in the June quarter, while Latin America grew 5.3%. Church & Dwight’s US organic sales rose 5.1%, and it raised its full-year organic outlook to 4%-5%. If both hold up in tomorrow’s reports, Haleon’s Brazil and North America troubles look like its own.
TIKR tracks 5 analysts on Haleon. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Haleon, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Haleon’s Analyst Ratings
Priced like a slow grower
Haleon’s forward P/E was 17x at yesterday’s close, below its three-year average of 19x:
Today’s drop takes it to about 15x, the bottom of that range.
My take: Haleon will trade like a slow grower until it gets back to 4%-6% growth, buyback or not. Of course, rival pain relief launches make the fourth quarter messy.
So what is Haleon stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
