Procter & Gamble (PG), the leviathan of the household products industry, is slated to announce its earnings before the market rings its opening bell on January 22nd. Here’s an insight into what investors might want to know.
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What are Analysts’ Expectations for Procter & Gamble’s Earnings?
Analysts forecast that the multinational giant would post earnings of $1.89 per share, which represents a slight decrease from the previous quarter’s EPS of $1.93. Revenue predicted to hover around $21.66 billion, close to what the company attained in the previous quarter ($21.74 billion).
Despite the slight downward adjustment, it’s worth remembering that Procter & Gamble sailed through the previous quarter with an impressive net margin of 17.07% and a return on equity of 33.25%, outperforming many in the industry.
Is Procter & Gamble’s Dividend Yield Attractive?
In terms of dividends, Procter & Gamble’s shareholders can look forward to a quarterly dividend of $1.0065 payable on February 18th. Extrapolated on an annual basis, this implies a comfortable yield of 2.50%, slightly above the industry average.
However, the company’s payout ratio is a high 69.31%, possibly reflecting management’s confidence in the company’s ability to keep generating sufficient profits.
Stock Target Advisor’s Analysis on Procter & Gamble:
The consensus among analysts is a “Moderate Buy” rating, with a target price of $179.65 on the stock. However, here at Stock Target Advisor, we hold a ‘Buy’ rating with a slightly conservative target price of $174.21.
We project an 8.12% price change over the next 12 months. Despite the recent stock price being $161.13 and experiencing monthly fluctuations (-8.06%), the annual change points towards a positive trajectory (+9.19%).
What’s the Coverage from Market Analysts?
The stock has the attention of fifteen Market Analysts, a considerable coverage. The average rating given is a “Strong Buy” with an average target price of $175.78. The maximum target set is $192, and the minimum is $155.
How’s the Sector Performance for Household & Personal Products?
Evaluating sector performance is crucial. The household and personal products sector have an average analyst rating of “Buy”. In contrast, Stock Target Advisor has a “Neutral” stance. Investors should watch for 1-week and 1-month return averages for the sector.
Conclusion:
As Procter & Gamble gears up for its earnings announcement, the expectations appear steady despite minor downward adjustments. Although there’s a cloud of insiders’ extensive selling, PG’s promising growth numbers, decent dividend yield, and favorable analyst ratings can still make it an attractive option for investors.
As always, it’s essential to consider all facets before making an investment decision.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
