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Procter & Gamble (PG) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Procter & Gamble (PG) closed the most recent trading day at $104.97, moving +1.27% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.11%. At the same time, the Dow lost 0.32%, and the tech-heavy Nasdaq gained 0.19%.

Heading into today, shares of the world's largest consumer products maker had gained 5.18% over the past month, outpacing the Consumer Staples sector's gain of 4.26% and the S&P 500's gain of 3.84% in that time.

Investors will be hoping for strength from PG as it approaches its next earnings release, which is expected to be April 23, 2019. The company is expected to report EPS of $1.05, up 5% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $16.36 billion, up 0.48% from the year-ago period.

PG's full-year Zacks Consensus Estimates are calling for earnings of $4.47 per share and revenue of $67.27 billion. These results would represent year-over-year changes of +5.92% and +0.66%, respectively.

Investors should also note any recent changes to analyst estimates for PG. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.04% lower. PG currently has a Zacks Rank of #3 (Hold).

Digging into valuation, PG currently has a Forward P/E ratio of 23.21. For comparison, its industry has an average Forward P/E of 21.73, which means PG is trading at a premium to the group.

Also, we should mention that PG has a PEG ratio of 3.37. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Soap and Cleaning Materials stocks are, on average, holding a PEG ratio of 3.69 based on yesterday's closing prices.

The Soap and Cleaning Materials industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 15, which puts it in the top 6% 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.

To follow PG in the coming trading sessions, be sure to utilize Zacks.com.


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