Procter & Gamble Shares Pop on Beat-and-raise, Analysts Positive
2022.04.20 16:22
Procter & Gamble (PG) Shares Pop on Beat-and-raise, Analysts Positive
Procter & Gamble (NYSE:PG) reported better-than-expected Q3 net sales, driving its shares up nearly 1% in premarket trading.
The consumer goods company reported Q3 net sales of $19.38 billion, topping the consensus estimates of $18.73 billion. Q3 EPS came in at $1.33, $0.03 better than the analyst estimate of $1.30.
Organic revenue grew 10% in the period compared to the expected growth of 6.24%. The company reported a price impact of 5% compared to the consensus projection of 3.24%.
For fiscal 2022, P&G expects organic revenue growth in the range of 6% to 7%, beating the consensus estimates of 5.49%. Core EPS growth is expected to land between 3% and 6%. It expects core EPS in the range of $5.83 to $6.00 compared to analyst estimates of $5.86 per share.
P&G said it expects headwinds of $2.5 billion due to increased commodity costs. Still, the company has raised its forecast for FY 2022 all-in sales growth to 4-5% compared to the previous forecast of 3-4% growth.
The company projects FY 2022 GAAP diluted net EPS growth in the range of 6% to 9%.
“We delivered another quarter with strong sales growth and made sequential earnings growth progress despite significant and increasing cost headwinds,” said Jon Moeller, President, and CEO of P&G.
P&G expects to distribute more than $8 billion in dividends and buy back roughly $10 billion of its shares in FY 2022.
Stifel analyst Mark S. Astrachan reflected positively on PG’s earnings report.
“We view the result as solid, reflecting ongoing share gains across most categories. We anticipate F2022 consensus is unlikely to move materially, with PG shares up modestly given the strong topline,” Astrachan said in a client note.
Goldman Sachs analyst Jason English reiterated a Buy rating on the PG stock with a 12-month price target of $173.
“All-in, weaker gross margins and an EPS outlook revision toward the low end of the range was widely expected by investors we speak with while the 10% organic sales growth outstripped the HSD% expectation we heard from most. As such, we believe results are strong enough to drive relative out performance for the stock today,” English wrote in a memo to clients.
By Senad Karaahmetovic
