Colgate and the Food and Drug Administration tested the toothpaste and said there was a low health risk from using it. However, Colgate said it was picking up suspected counterfeit products at discount stores where it was reportedly distributed, and checking to make sure none of the accounts handling Colgate toothpaste in the United States have the counterfeit product.
In May, Colgate-Palmolive predicted annual volume growth between 5-8%. Analysts polled by Thomson Financial expect second-quarter net income of 84 cents per share on revenue of $3.31 billion.
Morgan Stanley analyst William Pecoriello said strength in emerging markets such as Brazil and accelerated savings should help results in the quarter.
He expects sales to grow 11 percent to 12 percent in the quarter, with operating profit up 12 percent. He rates the stock "Overweight."
Bear Stearns analyst Justin Hott also said results would be helped by business in emerging markets.
"However, we worry that Colgate's share price is not being driven by its solid fundamentals, but by M&A speculation that creates additional volatility in the stock," he warned.