What happened

Colgate-Palmolive (CL -0.46%) stock has outperformed the market through mid-August, with shares up about 12% compared to a 5% increase in the S&P 500. That's better than consumer staples rival Procter & Gamble has done, but not quite as good as peer Kimberly-Clark, which is up 15% so far in 2020.

So what

Like these more diversified giants, Colgate has seen faster sales growth thanks to changes in consumer shopping behavior around the COVID-19 pandemic. Organic revenue jumped by nearly 6% in the quarter that ended on June 30 and by 7.5% in the prior quarter that captured the early days of the outbreak. That's significantly higher than the initial 3% to 5% growth outlook that management issued back in late January.

A child brushing his teeth.

Image source: Getty Images.

Now what

Colgate-Palmolive pulled that outlook as soon as COVID-19 injected volatility into key metrics like economic growth rates, unemployment levels, and consumer incomes. Executives stressed the fact that these risks haven't abated yet and could hurt its sales opportunities in the second half of 2020.

But the good news is the consumer staples giant is entering that period with plenty of cash that it can direct toward growth initiatives like increased marketing spending. Those assets may help support strong investor returns even if demand falls back down as the COVID-19 threat fades.