The Procter & Gamble Company (PG) recently expanded recall of dry pet food manufactured by its subsidiary, Natura Pet Products Inc., due to possible contamination with Salmonella. It has been confirmed that Salmonella was found in dry cat food and a cat pet treat. However, no Salmonella related infection has been reported to date.
On Mar 18, the company has initiated the recall of specific lots of dry pet food. However, in order to mitigate risks, Natura is further recalling products made in the same time frame.
The Natura Pet product line is a well-known name for premium pet food and treats. The products are made in accordance with nutritional science and include high quality ingredients. Natura Pet products represent several well-known brands such as Innova, Evo, California Natural, Healthwise, Mother Nature and Karma.
Overall, we are encouraged by P&G’s strong brand recognition, diversified portfolio, rapid growth in developing nations, impressive product development capabilities and marketing prowess. Though fiscal 2012 turned out to be a tough year for P&G, Procter & Gamble plans to implement some meaningful changes to re-accelerate its top and bottom line.
In addition, the company has implemented costs savings and productivity improvement initiatives in order to improve margins. P&G is gaining momentum from these efforts as evident from two back-to-back solid quarterly results. However, we would remain on the sidelines until we witness further progress from the turnaround efforts.
Procter & Gamble currently carries a Zacks Rank #3 (Hold).
Other companies in the consumer staples sector that warrant investors’ attention include Church & Dwight Co. Inc. (CHD), The Clorox Company (CLX), and Zep, Inc. (ZEP). All the three companies carry a Zacks Rank #2 (Buy).
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