The Procter & Gamble Company Earnings: Will Emerging Markets Help P&G Grow?

On Wednesday, Procter & Gamble (NYSE: PG  ) will release its quarterly report, and shareholders have been cautiously optimistic about the consumer-products giant's ability to start growing more sustainably again. Even with Colgate-Palmolive (NYSE: CL  ) and Kimberly Clark (NYSE: KMB  ) competing against it around the world, Procter & Gamble has an unmatched reputation and brand presence that give it a serious advantage over its rivals in seeking to capture the rising consumer class in emerging markets across the globe.

Procter & Gamble's products have a place in millions of American households and in the vast majority of countries around the world. But even a ubiquitous company like Procter & Gamble isn't immune from economic pressures, and the bumpy road that many emerging markets have faced recently poses a threat to P&G's long-term strategy of adding to its count of loyal customers. Can Procter & Gamble fend off Kimberly Clark, Colgate-Palmolive, and the rest of its competitors? Let's take an early look at what's been happening with Procter & Gamble over the past quarter and what we're likely to see in its report.

Source: Procter & Gamble.

Stats on Procter & Gamble

Analyst EPS Estimate


Change From Year-Ago EPS


Revenue Estimate

$20.68 billion

Change From Year-Ago Revenue


Earnings Beats in Past 4 Quarters


Source: Yahoo! Finance.

What's next for Procter & Gamble earnings?
Analysts have pulled back on their views on Procter & Gamble earnings in recent months, cutting their first-quarter estimates by $0.07 per share and reducing their full-year fiscal 2014 and 2015 projections by 1% to 2% as well. The stock has held up well, rising 2% since mid-January.

Procter & Gamble impressed investors with its fourth-quarter earnings report, which included an 8% rise in adjusted profit driven by 3% organic sales growth. Cost-cutting helped Procter & Gamble keep more of its revenue on its bottom line, and the company thinks it can roughly quadruple the amount of savings it has achieved so far and do so sustainably in a way that will lead to permanent cost reductions. P&G highlighted the Winter Olympics as a venue to announce new product lines and variants, and giving shoppers new things to try could well be a strong catalyst for further growth for the company.

Source: Procter & Gamble.

But less than a month later, it had to reduce its guidance for the fiscal 2014 year, cutting estimates for sales growth by half and reducing earnings targets as well. The culprit was the devaluation of the Venezuelan bolivar, which was only the latest in a series of currency-related headwinds that it has had to face alongside peers Kimberly Clark and Colgate-Palmolive. The move wasn't the first time the company has had to deal with currency devaluation, and given the significant number of assets that Procter & Gamble has in Venezuela, it might well not be the last.

Still, Procter & Gamble's focus remains on emphasizing its highest-potential businesses while getting rid of those that don't make the cut. Within the past month, it said it would sell a large part of its pet-food brands to Mars for $2.9 billion, and although P&G will keep some of its pet products, it's clear that the company wants to avoid a repeat of the recall it had to make last year due to possible contamination of pet food.

In the Procter & Gamble earnings report, watch to see how various regions of the world compare to each other in terms of sales and net income. With so much potential, the company needs to double down on making sure it competes in key emerging markets around the world to avoid letting its rivals gain the upper hand.

Six stock picks poised for incredible growth
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Click here to add Procter & Gamble to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2921514, ~/Articles/ArticleHandler.aspx, 9/5/2015 12:20:29 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Dan Caplinger

Dan Caplinger has been a contract writer for the Motley Fool since 2006. As the Fool's Director of Investment Planning, Dan oversees much of the personal-finance and investment-planning content published daily on With a background as an estate-planning attorney and independent financial consultant, Dan's articles are based on more than 20 years of experience from all angles of the financial world.

Today's Market

updated 15 hours ago Sponsored by:
DOW 16,102.38 -272.38 -1.66%
S&P 500 1,921.22 -29.91 -1.53%
NASD 4,683.92 -49.58 -1.05%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/4/2015 4:01 PM
PG $68.76 Down -1.17 -1.67%
Procter & Gamble CAPS Rating: ****
CL $61.46 Down -1.46 -2.32%
Colgate-Palmolive CAPS Rating: ****
KMB $103.52 Down -2.12 -2.01%
Kimberly-Clark CAPS Rating: *****