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4-Traders Homepage  >  Equities  >  Nyse  >  Procter & Gamble Company    PG

Delayed Quote. Delayed  - 10/20 10:00:26 pm
88.25 USD   -3.65%
08:48aDJNELSON PELTZ : Thrifty Consumer Habits Puzzle P&G -- WSJ
10/20DJPROCTER & GAMBL : Puzzled by Decreased Consumer Spending -- Update
10/20 DOW MOVERS : Ge, csco
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Thrifty Consumer Habits Puzzle P&G -- WSJ

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10/21/2017 | 08:48am CEST

Company remains under pressure despite victory over activist investor Nelson Peltz

By Sharon Terlep and Allison Prang 

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (October 21, 2017).

U.S. shoppers continue to cut back spending on household goods from paper towels to diapers, depressing sales at Procter & Gamble Co., and the consumer giant would like to know why.

The maker of Tide and Pampers reported another quarter of sluggish growth Friday. Fresh off an apparent victory over activist investor Nelson Peltz, P&G is under pressure to show it can bolster sales.

The company's organic sales, a closely watched metric that strips out currency moves, acquisitions and divestitures, rose 1% in the quarter, the increase almost entirely driven by emerging markets outside the U.S.

"We've been unable to put our finger on why this has been," Chief Financial Officer Jon Moeller said in a call with investors. Shoppers continue to consume at the same levels but are spending less on staples. "I've heard theories but nothing to explain the broad slowdown."

P&G said global spending on consumer staples, already tepid in 2017, has slowed even more. The company estimated global industry growth at about 2.3% for the quarter, down from 2.5% the previous period. U.S. growth was essentially flat, the company said.

This week, fellow consumer-products company Unilever PLC also reported weaker-than-expected sales, while Reckitt Benckiser Group, maker of Lysol cleaner and Durex condoms, said it would split its business into two divisions.

Neither gains by lower-cost private-label products nor consumers switching to less-pricey brands accounts for the U.S. spending decline, Mr. Moeller said.

He discounted two other theories behind the slowdown: that Hispanic shoppers are spending less amid concerns over Trump administration immigration policies and that consumers have shifted spending to services. P&G data shows no particular slowdown in markets with a large Hispanic population, Mr. Moeller said, "and the idea that, 'I want a cellphone so I'm not going to wash my hair,' doesn't make sense to me."

Price cuts driven by retailers as they battle each other and online rivals may in part account for the decreased spending, he said.

P&G said its fiscal first-quarter profit rose 5% as China, once a weak spot, now is driving growth. To highlight the turnaround there, Mr. Moeller hosted the analysts' call from P&G's Guangzhou office. Two years ago, P&G CEO David Taylor said publicly that the company lost its footing there. P&G's organic sales in the country rose 8% in the recently ended quarter.

Shares in P&G, up 5.5% over the past year, declined 3.2% to $88.63 in morning trading.

The results come as Mr. Peltz narrowly missed obtaining a seat on P&G's board last week, according to a preliminary vote tally. At least $60 million was spent on the proxy fight -- which the Trian Partners chief executive says isn't over yet -- making it the priciest in U.S. history. Trian declined to comment on P&G's first-quarter results Friday.

The company's profit rose to $2.85 billion, or $1.06 a share, from $2.71 billion, or 96 cents a share. Total sales rose to $16.65 billion from $16.52 billion.

The company expects sales to grow 2% to 3% in the current fiscal year, which ends in June, unchanged from the previous forecast.

P&G's sales growth in the first quarter was helped by segments related to beauty; fabric and home care; and health care. Net sales in the grooming segment, as well as baby, feminine and family care, each fell.

Write to Sharon Terlep at [email protected] and Allison Prang at [email protected]

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Financials ($)
Sales 2018 66 995 M
EBIT 2018 14 984 M
Net income 2018 11 035 M
Debt 2018 24 299 M
Yield 2018 3,19%
P/E ratio 2018 21,55
P/E ratio 2019 19,97
EV / Sales 2018 3,72x
EV / Sales 2019 3,63x
Capitalization 225 B
Chart PROCTER & GAMBLE COMPANY
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Procter & Gamble Company Technical Analysis Chart | PG | US7427181091 | 4-Traders
Technical analysis trends PROCTER & GAMBLE COMPANY
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TrendsBearishNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 21
Average target price 93,6 $
Spread / Average Target 6,0%
EPS Revisions
Managers
NameTitle
David S. Taylor Chairman, President & Chief Executive Officer
Jon R. Moeller Vice Chairman & Chief Financial Officer
Kathleen B. Fish Chief Technology Officer
Javier Polit Chief Information Officer
Scott D. Cook Independent Director
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