Procter & Gamble
will offer a look at what shoppers are buying when it posts quarterly numbers on Tuesday.
The consumer products titan owns a range of brands, from Luvs and Pampers disposable diapers, to Bounty paper towels and Tide laundry detergent, to Crest toothpaste and Pepto-Bismol stomach relief. And what’s selling and what’s not could provide a window to what’s ahead for the company and investors—as well as the U.S. and global economies.
Wall Street is expecting Procter & Gamble, or P&G, to post adjusted earnings of $1.70 a share on sales of $21.48 billion, according to FactSet. The company turned in earnings of $1.59 a share on sales of $20.77 billion in the year-ago quarter.
J.P. Morgan analysts were cautious ahead of the fiscal second-quarter report, lowering their projections because of China’s stumbling economy and spillover from the Israel-Hamas War. They rate P&G shares at Overweight but lowered volume estimates and cut their price target to $162 from $169.
“We are updating our estimates to incorporate a few factors…, including the weaker China recovery and some potential demand softness in smaller markets (such as Turkey and Saudi Arabia), where negative sentiment in light of the Middle East tensions is hampering demand for American brands…,” analysts wrote in a Jan. 18 report.
The J.P. Morgan team is upbeat about the second half of the year, arguing that lower costs, a favorable product mix anda favorable pricing strategy could allow P&G to reach the higher end of guidance—even if volume recovery is slower.
“Net-net, we still think PG will not need to lower its FY24 guide,” the team added.
In Monday trading, P&G stock was flat at $147.57.
Write to Emily Dattilo at [email protected]
Read the full article here