Procter & Gamble (NYSE:PG) Shares Climb 5.4% Following Strong Earnings

Procter & Gamble Company (The) (NYSE:PG)’s stock price traded up 5.4% during trading on Thursday following a better than expected earnings announcement. The stock traded as high as $166.72 and last traded at $165.3170. Approximately 5,141,364 shares traded hands during trading, a decline of 47% from the average daily volume of 9,660,444 shares. The stock had previously closed at $156.84.

The company reported $2.00 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.89 by $0.11. Procter & Gamble had a return on equity of 31.36% and a net margin of 18.44%. The company had revenue of $23.28 billion for the quarter, compared to analysts’ expectations of $22.80 billion. During the same quarter in the previous year, the firm earned $1.99 earnings per share. Procter & Gamble’s quarterly revenue was up 4.0% on a year-over-year basis.

Procter & Gamble Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Monday, November 16th. Shareholders of record on Friday, October 23rd will be paid a dividend of $1.0885 per share. The ex-dividend date is Friday, October 23rd. This represents a $4.35 annualized dividend and a yield of 2.6%. Procter & Gamble’s dividend payout ratio (DPR) is 65.71%.

Key Headlines Impacting Procter & Gamble

Here are the key news stories impacting Procter & Gamble this week:

• Positive Sentiment: PG reported quarterly earnings of $2.00 per share, exceeding the $1.89 consensus estimate and rising from $1.99 a year earlier. Revenue increased 4% year over year to $23.28 billion, above expectations of approximately $22.80 billion. Procter & Gamble Q1 Earnings and Revenues Beat Estimates
• Positive Sentiment: Sales growth was supported by laundry and home-care products, suggesting demand for essential brands such as Tide and Pampers is holding up despite pressure on consumer budgets. Procter & Gamble Earnings Beat as Sales Rise 4%
• Positive Sentiment: The company raised its full-year sales outlook, with the acquisition of Thorne contributing to the improved forecast. Organic growth guidance remains approximately 1% to 3%. Organic Growth and Thorne Acquisition Drive Procter & Gamble Earnings
• Positive Sentiment: Royal Bank of Canada reaffirmed its Outperform rating and maintained a $166 price target, implying additional upside from the referenced share price. Royal Bank of Canada Reaffirms Outperform Rating
• Neutral Sentiment: PG’s defensive profile remains attractive to income investors: the company recently announced its 70th consecutive annual dividend increase. However, modest organic-growth expectations may limit the stock’s valuation upside.
• Negative Sentiment: Management warned that higher commodity and fuel costs could create an approximately $1.4 billion cost squeeze and result in a larger hit to annual profit. Investors will therefore focus on pricing, cost controls and whether sales growth can offset inflationary pressures. P&G Flags Bigger Hit to Annual Profit from Higher Commodity Costs

Wall Street Analyst Weigh In

Several analysts have recently commented on PG shares. Argus downgraded shares of Procter & Gamble from a “buy” rating to a “hold” rating in a report on Friday, August 7th. JPMorgan Chase & Co. cut their price target on shares of Procter & Gamble from $164.00 to $162.00 and set an “overweight” rating on the stock in a report on Thursday, July 16th. TD Cowen reaffirmed a “hold” rating and issued a $150.00 price objective on shares of Procter & Gamble in a research report on Wednesday, September 30th. HSBC reaffirmed a “hold” rating and issued a $149.00 price objective (down from $182.00) on shares of Procter & Gamble in a research report on Thursday, July 30th. Finally, Citigroup increased their price objective on shares of Procter & Gamble from $170.00 to $180.00 and gave the company a “buy” rating in a research note on Friday, October 9th. Fourteen investment analysts have rated the stock with a Buy rating and ten have assigned a Hold rating to the stock. Based on data from MarketBeat, the company presently has a consensus rating of “Moderate Buy” and a consensus price target of $162.20.

Insider Buying and Selling

In other Procter & Gamble news, CEO Paul Gama sold 2,225 shares of the stock in a transaction on Monday, October 5th. The stock was sold at an average price of $145.34, for a total transaction of $323,381.50. Following the completion of the transaction, the chief executive officer directly owned 51,124 shares of the company’s stock, valued at approximately $7,430,362.16. This represents a 4.17% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, insider Marc S. Pritchard sold 4,030 shares of the firm’s stock in a transaction on Thursday, August 20th. The stock was sold at an average price of $143.79, for a total value of $579,473.70. Following the completion of the sale, the insider directly owned 187,001 shares of the company’s stock, valued at $26,888,873.79. This represents a 2.11% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold a total of 15,135 shares of company stock worth $2,189,970 in the last three months. Insiders own 0.23% of the company’s stock.

Institutional Inflows and Outflows

A number of institutional investors have recently made changes to their positions in the company. BlackRock Inc. bought a new stake in Procter & Gamble during the 2nd quarter valued at $27,862,105,000. State Street Corp lifted its position in Procter & Gamble by 1.0% during the second quarter. State Street Corp now owns 102,216,308 shares of the company’s stock valued at $14,988,999,000 after purchasing an additional 965,461 shares during the last quarter. Bank of America Corp DE purchased a new stake in Procter & Gamble during the second quarter valued at about $3,850,628,000. Bank of New York Mellon Corp bought a new position in Procter & Gamble during the second quarter valued at approximately $2,281,505,000. Finally, Dimensional Fund Advisors LP boosted its position in Procter & Gamble by 2.6% during the first quarter. Dimensional Fund Advisors LP now owns 11,797,916 shares of the company’s stock valued at $1,704,182,000 after buying an additional 300,280 shares during the period. Hedge funds and other institutional investors own 65.77% of the company’s stock.

Procter & Gamble Trading Up 5.4%

The company has a debt-to-equity ratio of 0.43, a quick ratio of 0.47 and a current ratio of 0.68. The firm has a market capitalization of $383.89 billion, a P/E ratio of 24.97, a price-to-earnings-growth ratio of 3.96 and a beta of 0.39. The firm has a 50-day moving average of $147.65 and a 200-day moving average of $146.83.

About Procter & Gamble

Procter & Gamble Company (NYSE: PG) is a global consumer products company that develops, manufactures and markets branded products used in households and personal care. Its portfolio includes personal health and grooming products, beauty and skin care items, baby, feminine and family care products, fabric and home care products, and oral care products.

The company’s well-known brands include Pampers, Tide, Gillette, Crest, Oral-B, Head & Shoulders, Pantene, Olay, Old Spice, Dawn, Febreze and Mr.