Reckitt Benckiser Group plc

Financial Performance

5Y price score: (46)

10Y return: (31.5)%

DATE RANGE:

US$ Per
Share

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12.0

52-week range

22.1

14.2

Your model inputs

Required return / cost of capital

FCFF terminal growth rate

Your fair value & Margin of safety

To calculate fair value based on cost of capital and terminal growth assumptions above, please select free cash flow forecast.

Forecast:

Valuation

Free Cash Flow Yield

4.6 %

Dividend Yield TTM

6.4 %

Market cap $

$ 45,091

Price / Earnings TTM

11.8

Price / Book TTM

PEG TTM

(0.3)

Earnings growth and return

LTM

5YR

10YR

Total return (price & dividends)

(29.5) %

(21.1) %

(31.5) %

Free cash flow per share growth

(43.3) %

(39.8) %

16.9 %

Earnings per share growth

(37.5) %

187.9 %

97.9 %

Founded: 2,007

Employees: 40,000

Business Summary:Reckitt Benckiser Group plc manufactures and sells health, hygiene, and nutrition products in the United Kingdom, the United States, China, India, and internationally. The company offers acne treatment creams, facial washes, and cleansing pads; disinfection, hygiene, and first aid products; condoms, sex toys, and lubricants; heartburn and indigestion solutions; and cough and chest congestion, multi-symptom, and sinus remedies for adults and children under the Clearasil, Dettol, Durex, Gaviscon, and Mucinex brands. It also provides analgesics; sore throat medications; and hair removal products under the Nurofen, Strepsils, and Veet brands. In addition, the company offers fragrances and devices; water softeners; home cleaning products; dish washes; toilet cleaners; disinfectants; sprays, baits, and plug-ins for pest control; stain removals; fabric washing; and other hygiene products under the Air Wick, Calgon, Cillit Bang, Finish, Harpic, Lysol, Mortein, Vanish, and Woolite brands, as well as analgesics, adult nutrition products, iron-fortified hypoallergenic baby formula, products for joint issues, and infant and toddler nutrition products, as well as vitamins, minerals, and supplements under the Biofreeze, Airborne, Mead Johnson, Move Free, Enfamil, and Nutramigen brands. Further, it provides probiotics, sore throat pain relief products, Omega products, brain health support products, cleaning and carpet cleaning products, septic tank system treatment products, cough syrups, plant-based laundry products, probiotics, and lubricants under the Digestive Advantage, Cepacol, MegaRed, Neuriva, Easy-Off, RID-X, Delsym, Botanical Origin, Bodi-Ome, and K-Y brands. The company was founded in 1819 and is headquartered in Slough, the United Kingdom.

Fair Value Reference Estimate

Latest Earnings Call Takeaways

2026 Q2 (Jul 29, 2026)

1) Performance Overview - Reckitt reported a significant acceleration in Q2 2026, achieving like-for-like net revenue growth of 4.2% in Core Reckitt, up from 2.7% in the first half. - The overall group delivered like-for-like net revenue growth of 2.6% in H1, with Q2 growth at 4.7%. - Emerging markets showed strong performance, with high single-digit growth driven by China and India, while North America returned to growth due to strong demand for Lysol and the launch of Mucinex 12 Hour Cold & Fever.

2) Financial Highlights - Adjusted EPS for H1 was 152.1p, a decline of 9.7% YoY, primarily due to the divestment of Essential Home. - The adjusted operating profit margin for Core Reckitt and Mead Johnson was 23.6%, higher than expectations, aided by reduced stranded costs and effective cost management. - Reckitt returned approximately GBP 3 billion to shareholders through dividends and share buybacks, with a new GBP 500 million buyback announced.

3) Challenges and Headwinds - The company faced challenges from increased input costs and supply chain disruptions due to geopolitical tensions in the Middle East, impacting gross margins. - The gross margin for Core Reckitt was 60.9%, down 110 bps YoY, influenced by a change in category mix and external cost pressures. - Destocking in North America was noted, particularly in the grocery channel, but the company expects this to stabilize as retailers prepare for seasonal demand.

4) Strategic Initiatives and Innovations - Reckitt's Fuel for Growth program continues to drive efficiency, with a target to reduce fixed costs below 19% of net revenue by 2027. - Innovations such as Dettol Activ Botany and Vanish Turbo have contributed positively to growth, with plans for further launches in the second half. - The company is enhancing its digital capabilities, including AI integration, to improve product development and consumer engagement.

5) Guidance and Outlook - Reckitt maintains its full-year guidance of 4% to 5% like-for-like net revenue growth for Core Reckitt, with expectations of stronger performance in Q4 compared to Q3. - The company anticipates continued broad-based growth in emerging markets and a gradual recovery in Europe, despite ongoing challenges in the Auto Dish category. - The transcript lacks detailed projections for specific product lines and regional performance metrics for the second half.

Bottom line: Reckitt's strong Q2 performance and strategic focus on innovation and efficiency position it well for continued growth, despite facing external challenges. The company remains committed to returning value to shareholders while navigating a complex market landscape.

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