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Procter & Gamble (PG) Gains But Lags Market: What You Should Know

Zacks Equity Research

In the latest trading session, Procter & Gamble (PG) closed at $122, marking a +0.88% move from the previous day. This change lagged the S&P 500's 0.91% gain on the day. Meanwhile, the Dow gained 0.7%, and the Nasdaq, a tech-heavy index, added 1.02%.

Coming into today, shares of the world's largest consumer products maker had gained 0.88% in the past month. In that same time, the Consumer Staples sector lost 2.39%, while the S&P 500 lost 2.74%.

Wall Street will be looking for positivity from PG as it approaches its next earnings report date. This is expected to be October 22, 2019. On that day, PG is projected to report earnings of $1.24 per share, which would represent year-over-year growth of 10.71%. Our most recent consensus estimate is calling for quarterly revenue of $17.49 billion, up 4.82% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.85 per share and revenue of $70.31 billion. These totals would mark changes of +7.3% and +3.88%, respectively, from last year.

Any recent changes to analyst estimates for PG should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% higher. PG is currently a Zacks Rank #2 (Buy).

Investors should also note PG's current valuation metrics, including its Forward P/E ratio of 24.95. This represents a premium compared to its industry's average Forward P/E of 22.65.

Meanwhile, PG's PEG ratio is currently 3.51. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Soap and Cleaning Materials stocks are, on average, holding a PEG ratio of 4.03 based on yesterday's closing prices.

The Soap and Cleaning Materials industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 168, putting it in the bottom 35% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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