Will Procter & Gamble (PG) Retain Its Upside Story in 2022?
CONTRIBUTOR
Zacks Equity
Research
PUBLISHED
FEB 9, 2022
10:19AM EST
https://www.nasdaq.com/articles/will-procter-gamble-pg-retain-its-upside-story-in-2022
The Procter & Gamble Company PG has been gaining from a spike in demand
for cleaning products due to the resurgence of COVID-19 cases as well as improved productivity.
Strength across brands also bodes well. This led to better-than-expected
second-quarter fiscal 2022 results, wherein the top and bottom lines not only
surpassed the Zacks Consensus Estimate but also grew year over year.
The company retained its robust earnings surprise for more than three years,
while its revenues topped estimates for the seventh straight time in the fiscal
second quarter. Net sales advanced 6% year over year, owing to strength across
all segments, coupled with robust volume and pricing gains. On an organic basis
(excluding the impacts of acquisitions, divestitures and foreign exchange),
revenues improved 6%, backed by a 3% increase in the shipment volume and a 3%
rise in pricing. All of the company’s business segments reported growth in
organic sales.
Procter & Gamble remains focused on productivity and cost-saving plans to
boost margins. The company has been witnessing cost savings and efficiency
improvements via continued investment in businesses alongside efforts to offset
cost headwinds. As a result, it expects $800 million in COGS savings this year.
Its core currency-neutral gross and operating margins reflected 80-bps gains
from productivity savings and 130 bps from pricing benefits in second-quarter
fiscal 2022.
Driven by these
factors, management raised its fiscal 2022 guidance. The company anticipates
all-in sales growth of 3-4%, up from the previously mentioned 2-4%. Organic
sales are likely to increase 4-5%, up from the earlier stated 2-4%. EPS, on a
reported basis, is expected to increase 6-9%, whereas the company reported
$5.50 in fiscal 2021. Core EPS for fiscal 2022 is anticipated to grow 3-6% from
$5.66 earned in fiscal 2021.
Consequently, shares of this Zacks Rank #3 (Hold) company have gained 28.1% in
the past year compared with the industry’s growth
of 16.3%.
However, higher
commodity and freight costs remain a headwind. This led to dismal margins in
the fiscal second quarter. The gross margin contracted 400 basis points (bps)
to 49.1%, while the operating margin declined 250 bps from the prior year to
24.7%. On a currency-neutral basis, the gross margin declined 410 bps, while
the operating margin contracted 240 bps year over year.
The company notes that input costs have continued to rise. It anticipates
after-tax commodity cost headwinds of $2.3 billion for fiscal 2022. It also
estimates an additional after-tax headwind of $300 million from freight and
transportation costs in fiscal 2022. This is included in the company’s earnings
per share view for fiscal 2022. On a combined basis, the company expects higher
commodity and freight costs to hurt fiscal 2022 EPS by $1.10 per share.
Conclusion
Despite cost headwinds, we believe that solid demand, brand strength and productivity efforts are likely to help PG sustain its momentum in 2022. The Zacks Consensus Estimate for the company’s current financial year’s sales and earnings suggests growth of 4.5% and 4.4%, respectively, from the year-ago period’s reported numbers. The positive trend signifies bullish analyst sentiments. Topping it, the stock has a long-term earnings growth rate of 6.8%.
Procter & Gamble
Company (P&G)
https://en.wikipedia.org/wiki/Procter_%26_Gamble#Controversies
Controversies
Logo Myth
P&G's former logo originated in 1851 as a crude
cross that barge workers on the Ohio River painted
on cases of P&G star candles to identify them. P&G later changed this
symbol into a trademark that showed a man in the moon overlooking 13 stars,
said to commemorate the original 13 colonies.[96]
The company
received unwanted media publicity in the 1980s due to rumors, spread largely
by Amway distributors,
that the moon-and-stars logo was a satanic symbol.
The accusation was based on a particular passage in the Bible,
specifically Revelation 12:1, which states: "And there appeared a
great wonder in heaven; a woman clothed with the sun, the moon under her feet and
upon her head a crown of 12 stars." P&G's logo consisted of a man's
face on the moon surrounded by 13 stars. Some claimed that the logo was a
mockery of the heavenly symbol alluded to in the aforementioned verse, thus
construing the logo to be satanic. Where the flowing beard meets the
surrounding circle, three curls were said to be a mirror image of the
number 666,
or the reflected number of the beast. At the top and bottom, the hair curls in
on itself and was said to be the two horns like those of a ram. The
moon-and-stars logo was claimed to be discontinued in 1985 in a failed attempt
to quash the rumors.[97] In
1991, details of the logo were simplified to avoid the connection and remove
aspects alleged to indicate Satanist affiliations.[98][99] The
company moved to a text-only logo in 1995, though in 2013 it unveiled a new
logo with a hint of a crescent moon behind the text.[99]
These interpretations have been denied by company officials and no evidence linking the company to the Church of Satan or any other occult organization has ever been presented. The company unsuccessfully sued Amway from 1995 to 2003 over rumors forwarded through a company voice-mail system in 1995. In 2007, the company successfully sued individual Amway distributors for reviving and propagating the false rumors.[100] The Church of Satan denies being supported by Procter & Gamble.
Connecting the Dots:
Angela F. Braly is
a director at the Procter & Gamble
Company, and a trustee at the Committee
for Economic Development.
Foundation to Promote Open Society was a funder for the Committee for Economic Development.
George Soros was the chairman for the Foundation
to Promote Open Society.
Deborah Platt
Majoras is a trustee at the Committee
for Economic Development and the chief legal officer for the Procter & Gamble Company.
Joseph T. Gorman was
a trustee at the Committee for Economic
Development and a director at the Procter
& Gamble Company.
Mary Agnes
Wilderotter is a trustee at the Committee
for Economic Development and a director at the Procter & Gamble Company.
Donna S. Morea was
a trustee at the Committee for Economic Development
and the EVP for the CGI Group Inc.
CGI Group Inc. was the Obamacare contractor that developed Healthcare.gov web site.
Obamacare is Barack
Obama’s signature policy initiative.
Larry D. Thompson is
a trustee at the Committee for Economic
Development and an honorary trustee at the Brookings Institution
(think tank).
Vernon E. Jordan Jr. is an honorary trustee at the Brookings Institution (think tank) and a
senior counsel for Akin, Gump, Strauss,
Hauer & Feld, LLP.
Akin, Gump, Strauss, Hauer & Feld, LLP is a lobby firm for Pfizer Inc.
Constance
J. Horner is
a director at Pfizer Inc. and
was a guest scholar at the Brookings Institution (think tank).
Foundation to Promote Open Society was a funder for the Brookings Institution (think tank).
George
Soros was
the chairman for the Foundation to Promote
Open Society.
Suzanne
Nora Johnson is
a director at Pfizer Inc. and a
trustee at the Brookings Institution (think
tank).
Amy
W. Schulman is
the EVP & general counsel for Pfizer
Inc. and a trustee at the Brookings
Institution (think tank).
Duberstein Group, Inc. is a lobby firm for Pfizer Inc.
Kenneth
M. Duberstein is
the chairman & CEO for the Duberstein Group,
Inc. and a trustee at the Brookings
Institution (think tank).
Mark
B. McClellan was
a senior fellow at the Brookings
Institution (think tank) and a commissioner for the U.S. Food and Drug Administration (FDA).
David
M. Rubenstein is
the co-chairman for the Brookings
Institution (think tank) and a regent at the Smithsonian Institution.
Joseph
R. Biden Jr. is
a regent at the Smithsonian Institution,
the vice president for the Barack Obama administration and is the president
of the Joseph Biden administration.
Barack
Obama was
the president for the Barack Obama administration, an intern at Sidley Austin LLP and Obamacare is Barack
Obama’s signature policy initiative.
Michelle Obama was
a lawyer at Sidley Austin LLP.
Sidley Austin LLP was a lobby firm for Pfizer Inc.
CGI Group Inc. was
the Obamacare contractor that developed Healthcare.gov web site.
Donna
S. Morea was
the EVP for the CGI Group Inc.
and a trustee at the Committee for Economic
Development.
Foundation to Promote Open Society was a funder for the Committee for Economic Development.
George
Soros was
the chairman for the Foundation to Promote
Open Society.
Deborah
Platt Majoras is
a trustee at the Committee for Economic
Development and the chief legal officer for the Procter & Gamble Company.
Joseph
T. Gorman was
a trustee at the Committee for Economic
Development and a director at the Procter
& Gamble Company.
Mary Agnes Wilderotter is a trustee at the Committee for Economic Development and a director at the Procter & Gamble Company.
Resources: Past Research
Obama Picks Ex-P&G
Head to Lead Veterans Affairs (Past Research on Procter
& Gamble Company (P&G))
MONDAY, JUNE 30,
2014
https://thesteadydrip.blogspot.com/search?q=Procter+%26+Gamble+Company
5 Cancer causing
children's snacks made from petroleum (Past
Research on the Committee for Economic Development & the Brookings
Institution (think tank))
SUNDAY, MARCH 12,
2017
https://thesteadydrip.blogspot.com/2017/03/5-cancer-causing-childrens-snacks-made.html
IG Farben / Bayer /
Pfizer / Israel (Past Research on Pfizer & the Brookings
Institution (think tank))
SUNDAY, SEPTEMBER
19, 2021
https://thesteadydrip.blogspot.com/2021/09/ig-farben-bayer-pfizer-israel.htm
Smithsonian Admits to
Destruction of Thousands of Giant Human Skeletons in Early 1900′s (Past Research on the Smithsonian Institution)
WEDNESDAY,
DECEMBER 10, 2014
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