Procter & Gamble (PG) is one of the great American companies. It just may be the greatest collection of brand name consumer products in the world. It is almost impossible to walk into a home in the United States and other developed nations and not find at least one of their products.
P&G represents such lines as Downy, Duracell, Febreze, Tide, Head & Shoulders, Olay, and Gillette as well as others consumers use pretty much daily. They have operations in about 70 countries and their products are sold in 180 nations around the globe. Wherever people, bathe, shave and wash clothes you are probably going to find Procter and Gamble products.
Procter & Gamble stock is considered to be one of the bluest of blue chips on the US markets today. Along with other dividend paying blue chip,s the stock has seen yield seeking buyers drive the stock price during the last five years and the stock has doubled off the lows.
For much of that time Portfolio Grader had the stock as either a buy or strong buy and investors who owned the stock have done very well. However the stock really needs stronger economic growth around the world to drive the type of earnings and sales growth to be a buy rated best of the best stock and while things are improving we are not there yet.
The company is scheduled to report earnings on April 23rd and analysts really are not expecting much from Procter and Gamble. The consensus is for the company to earn $1.02 a share on revenues of $20.73 billion.
In the year ago quarter they earned 99 cents a share with total sales of $20.6 billion so it’s not much of an improvement. For the full year Wall Street is looking for revenues of $85 billion and earnings per share of $4.22. That is a small increase from last year’s EPS of $4.05 and sales of $84.1 billion. PG is a great company but right now there is nothing especially exciting about Procter & Gamble stock and its prospects for the next few quarters at least.
When we look at the stock in Portfolio Grader we see that a year ago this time that Procter & Gamble stock was a buy but was downgraded in August as the fundamentals began to slip. The share were a hold until year end when a fourth quarter year over year decline caused the shares to be downgraded to a D.
At this point, we view Procter & Gamble stock a sell as we go into earnings season.