P&G Sales Outpace Estimates
Procter & Gamble Co. (P&G) reported sales that exceeded analysts’ estimates, as higher prices offset lower volume. The company’s shares rose in pre-market trading.
Revenue Growth
P&G reported organic sales growth of 4 percent in the quarter ended September 30, compared with the 3.7 percent growth estimated by analysts. The company’s net sales rose to $17.6 billion, beating the $17.4 billion estimated by analysts.
The company’s organic sales growth was driven by higher prices, which offset lower volume. P&G said it raised prices on some of its products to offset higher costs.
Growth in Beauty and Grooming Segment
P&G’s beauty and grooming segment reported organic sales growth of 5 percent, driven by higher prices and volume growth in the skincare and hair care categories. The segment’s net sales rose to $5.7 billion, beating the $5.6 billion estimated by analysts.
The company’s health care segment reported organic sales growth of 4 percent, driven by higher prices and volume growth in the oral care and feminine care categories. The segment’s net sales rose to $3.3 billion, beating the $3.2 billion estimated by analysts.
Growth in Fabric and Home Care Segment
P&G’s fabric and home care segment reported organic sales growth of 3 percent, driven by higher prices and volume growth in the laundry and home care categories. The segment’s net sales rose to $5.2 billion, beating the $5.1 billion estimated by analysts.
The company’s baby, feminine, and family care segment reported organic sales growth of 2 percent, driven by higher prices and volume growth in the baby care and family care categories. The segment’s net sales rose to $3.4 billion, beating the $3.3 billion estimated by analysts.
Growth in Snacks and Pet Care Segment
P&G’s snacks and pet care segment reported organic sales growth of 1 percent, driven by higher prices and volume growth in the pet care category. The segment’s net sales rose to $1.2 billion, beating the $1.1 billion estimated by analysts.
Outlook
P&G said it expects organic sales growth of 3 to 4 percent for the full year, driven by higher prices and volume growth in its beauty, health care, fabric and home care, and snacks and pet care segments. The company also said it expects to deliver earnings per share of $5.50 to $5.60 for the full year.
Share Price Increase
P&G’s shares rose 2.2 percent to $128.90 in pre-market trading on October 18. The company’s shares have gained 11 percent this year, outperforming the S&P 500 Index, which has gained 8.5 percent.
Analysts’ Opinions
Analysts have a positive outlook on P&G’s stock. According to Bloomberg, the average analyst rating for the stock is “buy”, with a 12-month price target of $140.
Conclusion
P&G reported sales that exceeded analysts’ estimates, as higher prices offset lower volume. The company’s beauty and grooming, health care, fabric and home care, and snacks and pet care segments all reported organic sales growth. P&G’s shares rose in pre-market trading, and analysts have a positive outlook on the stock.