Wells Fargo has revised its 2026 outlook for the consumer staples sector and slashed its price target for Church & Dwight (CHD) to $95, reflecting updated expectations for growth and margin pressures. The move signals cautious sentiment toward the category and impacts investor positioning in the stock.
- Wells Fargo cut Church & Dwight (CHD) price target to $95 from $110
- 2026 EPS forecast for CHD revised down to $8.75 from $9.20
- Downgrade tied to rising input costs and margin compression
- CHD shares declined 1.8% following the announcement
- Sector-wide review of consumer staples outlook underway
- Market reaction reflects growing caution on consumer discretionary resilience
Wells Fargo has updated its consumer staples sector outlook for 2026, introducing a more conservative forecast due to rising input costs and slowing demand trends. As part of the revision, the firm downgraded Church & Dwight (CHD) to a $95 price target from a prior $110, citing weaker-than-expected earnings momentum and increasing competitive intensity in key product lines. The new target implies a 12.7% downside from CHD’s current trading level as of January 11, 2026. The adjustment reflects revised revenue and earnings estimates, with the firm now projecting CHD’s 2026 EPS at $8.75, down from $9.20 previously. This reduction is primarily driven by inflationary pressures on packaging and raw materials, as well as declining volume growth in household care and personal care segments. The firm also noted that promotional activity has intensified, compressing margins and limiting pricing power in the short term. The change in outlook has triggered immediate market movement, with CHD shares dipping 1.8% in early trading. Analysts across the sector are reassessing their positions, particularly in the megacap consumer staples group, where several firms are reviewing their own estimates. The downgrade underscores broader concerns about consumer spending resilience amid elevated interest rates and inflationary persistence. Investors in CHD, a major player in branded household and personal care goods with products like Arm & Hammer and Trojan, are now evaluating the sustainability of its long-term growth trajectory. The revised target could influence trading strategies, including potential hedging or rebalancing within large-cap growth and value portfolios.