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Procter & Gamble Drops 6% on Mixed Q4 Results

Story Highlights

Investors were not enthused about Procter & Gamble’s earnings, which missed estimates. However, the company’s revenue growth amid supply chain constraints was impressive.

Consumer goods major The Procter & Gamble Company (NYSE: PG) reported mixed results for the fourth quarter ended June 30, 2022. Although revenues surpassed the estimates, earnings failed to do so. Consequently, shares of the company declined by almost 6%.

Revenue, Earnings Rise

Procter & Gamble reported quarterly net sales of $19.52 billion, up 3% from the previous year. Further, the figure topped the consensus estimate of $19.40 billion.

The company’s earnings per share (EPS) for the quarter came in at $1.21, which denotes a growth of 7% from the year-ago quarter. Yet, the figure missed the consensus estimate of $1.22 per share.

For the Fiscal Year 2022, the company reported net sales of $80.2 billion, up 5% from the previous year. EPS for the period came in at $5.81, which reflects a growth of 6% from the year-ago quarter.

Procter & Gamble’s operating income for the quarter came in at $3.6 billion. This represents a growth of 2% from the prior year.

Outlook for FY2023

For the Fiscal Year 2023, Procter & Gamble expects revenue growth of flat to up two percent versus the prior fiscal year. Organic sales growth is expected to be between 3%-5%.

The company expects EPS of $5.93 for FY2023. The consensus estimate for the same is pegged at $6.12.

Management’s Commentary

CEO of Procter & Gamble, Jon Moeller said, “Fiscal year 2022 was another strong year. The P&G team’s execution of our integrated strategies delivered strong top-line growth, earnings growth, and significant cash return to shareowners in the face of severe cost and operational headwinds. As we look forward to fiscal 2023, we expect another year of significant headwinds. We remain committed to our integrated strategies of superiority, productivity, constructive disruption and an agile and accountable organization structure.”

Wall Street’s Take

Overall, the Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on five Buys and five Holds. The PG average price target of $156.20 implies the stock has upside potential of 12.5% from current levels. Shares have gained marginally over the past year.

Mixed Website Traffic Data

TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Procter & Gamble’s performance this quarter.

Procter & Gamble’s mixed website traffic acted as a precursor to its disparate results.

According to the tool, the Procter & Gamble website recorded a 14.05% monthly fall in global visits in June, compared to May. However, year-to-date, Procter & Gamble website traffic increased by 83.04%, compared to the previous year.

Learn how Website Traffic can help you research your favorite stocks.

Key Takeaways

With inflation at record-high levels and an impending recession, consumers’ pockets are hurting. However, Procter & Gamble’s strong brand value and operational strength have allowed the company to continue to register growth despite the headwinds.

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