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Odds Released on Trojan Condom Stock Price and US Birth Rate in 2020

Daniel Coyle

by Daniel Coyle in News

Mar 17, 2020 · 2:27 PM PDT

Baby boom
Could we be set for a baby boom after the quarantine during COVID-19? Photo from sfu.marcin (Flickr)
  • Calls for self-isolation and quarantine have set the stage for a baby boom in 2020
  • Trojan condom manufacturer has rebounded from last week’s stock market meltdown, but continued uncertainty is likely to impact share price 
  • Get all the odds and insight into the best bets on America’s impending baby boom in the story below

As America hunkers down for what could be a lengthy stretch of self-isolation in response to the growing COVID-19 outbreak, could one of the unexpected consequences of the crisis be a baby boom as 2020 draws to a close?

You can bet on the population getting down to business while stuck inside their homes for the next couple of months.

Odds on Trojan Condom Stock Price / US Birth Rate

Prop Line Over Odds Under Odds
CHD Stock Price on March 31 65 US Dollars -120 -120
US Birth Rate on December 31, 2020 12% -120 -120

Odds taken on March 17th

Potential Baby Boom Good News for Condom Makers

While authorities have appealed to Americans to exercise social distancing, many observers expect a growing number of couples to eventually get closer.

That could be good news for investors in the company that manufactures Trojan brand condoms, with -120 odds that Church & Dwight Co. Ltd.’s share price will be over $65 USD at the close of trading on March 31st.

Founded in 1847, products made by the New Jersey-based manufacturer are among some of the most popular consumer goods in the United States, including Arm & Hammer Baking Soda, Pepsodent toothpaste, and OxiClean stain remover.

However, the company has also become a dominant force in the condom market, with US sales of Trojan brand condoms amounting to $4.15 billion in 2018.

While the price of the company’s stock, which is traded on NASDAQ under the symbol “CHD”, has dropped off since the start of 2020, it has shown signs of rallying in recent days. Pegged at $70.35 on December 31, CHD suffered substantial losses during the stock market meltdown of the past week, closing at just over $60 at the end of trading on Monday.

However, that swoon has been short-lived, with the stock making steady gains over the course of the day on Tuesday, once again topping $70. But can CHD maintain the momentum?

CHD Weathering Market Storm

Like every other Wall Street commodity, CHD is now subject to extreme volatility as the coronavirus crisis deepens. The NASDAQ has endured wild swings since last week, tumbling from its perch at over 8100 last Wednesday, and bottoming out at 6858.90 early on Tuesday morning before once again rebounding.

Those wide fluctuations have presented deep-pocketed investors with buying opportunities, while leaving average consumers with an increasing sense of anxiety.

Although the current uncertainty in the market is likely to continue, confidence in CHD remains high with a majority of analysts rating the stock as a hold or a buy, and at least one market analyst projecting the stock to rise to over $77 by March 2021.

Further Market Disruptions Look Increasingly Likely

It is too soon to tell, but one of the positives in favor of Church & Dwight is the strength of the growing condom market in China.

With millions of Chinese people now emerging from a lengthy and massive lockdown, it is possible that Trojan has already benefitted from increased sales in the virus-stricken country.

But while Church & Dwight remains a stable company, and Tuesday’s boost in stock price is heartening, it is reasonable to expect the COVID-19 crisis and its impact on stock markets to get worse. With a bear market now here, the prudent wager is on CHD closing at UNDER $65.00 on March 31, which pays out at -120.

Odds on Birth Rate Lack Clarity

Calls for lengthy self-isolation by large segments of the US population during the current coronavirus crisis has many observers expecting a baby boom at the end of 2020. As a result, odds have also been offered on a possible increase in the US birth rate for this year. However, it is a wager that should be treated with caution.

The odds of the US birth rate increasing by OVER 12% is at -120, but it is unclear what the oddsmakers are defining as birth rate. As defined by the Organization for Economic Co-operation and Development, “Crude Birth Rate” is represented not as a percentage but as “the number of live births occurring among the population of a given geographical area during a given year, per 1,000 mid-year total population of the given geographical area during the same year”.

While the projected Crude Birth Rate for the United States in 2020 is set at 11.990, that number represents a minuscule percentage increase of just 0.09% over 2019, and less than a 1.2% increase in population from year to year.

With the very real prospect of a baby boom looming, it is a good bet that the US will see its Crude Birth Rate top the projection of 11.990, but with the lack of clarity in the prop, the best advice is to avoid wagering on it at this time.

Picks: CHD stock price UNDER $65 (-120); Avoid wagering on US birth rate prop

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