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

Zacks Equity Research

Procter & Gamble (PG) closed at $138.01 in the latest trading session, marking a +0.28% move from the prior day. This change lagged the S&P 500's 1.61% gain on the day. At the same time, the Dow added 1.51%, and the tech-heavy Nasdaq gained 1.87%.

Coming into today, shares of the world's largest consumer products maker had lost 0.43% in the past month. In that same time, the Consumer Staples sector lost 2.47%, while the S&P 500 lost 4.08%.

Wall Street will be looking for positivity from PG as it approaches its next earnings report date. In that report, analysts expect PG to post earnings of $1.41 per share. This would mark year-over-year growth of 2.92%. Our most recent consensus estimate is calling for quarterly revenue of $18.21 billion, up 2.32% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.40 per share and revenue of $72.84 billion. These totals would mark changes of +5.47% and +2.67%, 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. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. PG currently has a Zacks Rank of #3 (Hold).

Investors should also note PG's current valuation metrics, including its Forward P/E ratio of 25.5. For comparison, its industry has an average Forward P/E of 24.58, which means PG is trading at a premium to the group.

We can also see that PG currently has a PEG ratio of 3.9. 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. The Soap and Cleaning Materials was holding an average PEG ratio of 3.87 at yesterday's closing price.

The Soap and Cleaning Materials industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 105, which puts it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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